[ET Net News Agency, 20 December 2019] Morgan Stanley said Wharf REIC's (01997)
acquisition of two investment properties (IP) in Singapore from its parent Wheelock
(00020) for HK$6.4bn helps leaner structure for Wheelock group.
The research house estimated the acquisition gross yield of 4.9% for retail and 4% for
office. Operating income yield could be 3.5%, slightly higher than cost of debt of 2.4%,
hence mildly earnings accretive.
The acquiring assets generated HK$163mn rental revenue and HK$111mn EBIT in 1H. This is
2% and 1.6% of Wharf REIC's 1H recurring revenue and EBIT.
Morgan said the deal is cash accretive to Wharf REIC, which could use the cash to add
more developed market commercial assets to boost recurring income. This also compensates
some of the weaknesses of HK and diversify earning base from HK.
Morgan maintained its "underweight" rating on Wharf REIC, with a target price of HK$40.
(KL)
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00020 SENSETIME-W
Nominal 
0.580 -0.030 (-4.918%) Research Report
20/12/2019 16:48
{I-bank focus}Wharf REIC's Singapore deal cash accretive
| Remark: | Real time quote last updated: 19/04/2024 17:56 |
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