Wednesday, September 25, 2013

An Analysis on Ascott REIT

Ascott REIT is listed on SGX on 31 March 2006

Financial Data

Year              Rev                      Net Income                   DPU
2013                                                                              8 - 8.2c (est)
2012         303.841 mil                99.698 mil                  8.76c
2011         288.653 mil                96.166 mil                  8.53c
2010         207.223 mil                57.714 mil                  7.54c
2009         175.522 mil                45.207 mil                  7.32c
2008         192.381 mil                53.659 mil                  8.78c
2007         154.837 mil                45.069 mil                  7.70c
2006         89.811 mil                  24.577 mil                  5.24c         * 9 months

Other Data (as at 30 Jun 2013)

Debt
  • Current: 239.652 mil 
  • L.Term: 1077.418 mil
  • Total:    1317.070 mil
Cash Balance: 141.235 mil
Div Yield: 7% (est)

NAV: $1.21
Shares Issued: 1,261,596,000


Business Model

A real estate investment vehicle that invest in property for hospitality purpose. Currently has a very big portfolio of 81 properties in Asia and Europe.

Opinion

Ascott REIT has distribute 4.081c for the first 1/2 of the year. While the remain half, we can expect another 4c. Given that its NAV is $1.21, we can expect a full value of $1.25-1.28 for FY 13. For the second half of their FY, they need to tackle their debt as their Cash on-hand show they need to raise additional cash to pay off their current debt. Thus, probably they will be using bonds to pay their big amount.


Conclusion

Given that Ascott is trading at ard $1.25 on 26 Sept 2013, they are fully valued. I would like to see further downside of 10% (below $1.15) to the counter before entering. This is to ensure we have a margin of safety and any downside risk is limited.

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