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Broker's take

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SINGAPORE PRESS HOLDINGS | HOLD

TARGET PRICE: $3.41

APRIL 26 CLOSE: $3.47

OCBC INVESTMENT RESEARCH, APRIL 26

Singapore Press Holdings (SPH) on Tuesday announced that it will acquire Orange Valley Healthcare Pte Ltd for approximately $164 million.

SPH's management indicates that, with the number of Singaporeans aged above 65 expected to double from 450,000 to 900,000 by 2030 and as family sizes shrink, there will be a surge in single elderly Singaporeans living alone.

This will in turn lead to a strong demand for aged-care services ranging from home care and community-based care to nursing homes. The group sees a strong need for long-term medical care for the greying population in Singapore ahead.

SPH also indicated that the transaction is not expected to have a material effect on the net tangible assets or earnings per share of the SPH Group for FY2017.


ASCENDAS REIT | BUY

TARGET PRICE: $2.73

APRIL 26 CLOSE: $2.60

RHB, APRIL 26

Despite challenges facing the industrial segment, we expect Ascendas Reit to book positive rental reversions of 2-5 per cent for FY18 (March).

About 16.6 per cent of its leases (as a percentage of gross income) are due for renewal this year, with the bulk coming from Singapore.

Of these, 43 per cent of the expiring leases are in the business and science park segments, which we are positive on.

We expect these to mitigate the negative rental reversions expected in the logistics and warehouse segments.

For Q4 17 and FY17, its rental reversions were at +3.2 per cent and +3.1 per cent respectively.

Only 3.2 per cent of its Singapore assets are single-tenant user buildings that are up for renewal in the next three years.

As we increasingly believe the Reit's Singapore portfolio is at the tail-end of the conversion cycle, we do not expect this to drag Ebit margins and rental rates.


MAPLETREE INDUSTRIAL TRUST | HOLD

TARGET PRICE: $1.80

APRIL 26 CLOSE: $1.84

CIMB RESEARCH, APRIL 25

Despite headwinds and management's conservativeness, Mapletree Industrial Trust's performance remains steady, with visible growth underpinned by organic developments.

Q4 2017 distribution per unit of 2.88 Singapore cents improved 2.5 per cent year on year on rental rates achieved in flatted factories, high-tech buildings and stack-up/ramp-up buildings as well as revenue contribution from phase one of the BTS data centre for Hewlett-Packard, partially offset by lower portfolio occupancy.

Also, a record net property income margin of 75.4 per cent reflects good cost management.

Disclaimer: All analyses, recommendations and other information herein are published for general information. Readers should not rely solely on the information published and should seek independent financial advice prior to making any investment decision. The publisher accepts no liability for any loss whatsoever arising from any use of the information published herein.