CMT

CMT: Credit Suisse notes that despite outperforming the STI ytd, CMT has lagged peers as the market perceives it to be expensive with sub-5% yields and 1.2x P/B. The house believes that the sub-5% yields this year do not reflect CMT's full potential, as portfolio occupancy has mainly been disrupted by a series of AEIs across 6 of its 15 assets. Notes that with cost measures (like chiller replacements) and improving occupancies with AEIs coming to fruition, NPI margins are beginning to normalise. Adds, despite CMT showing falls in 1H12's shopper traffic and tenant sales, with businesses reverting to norm post- AEIs, CS expects these data points to improve. CS maintains Outperform, with TP $2.17. Notes CMT is the largest (~ 20% market share of Singapore malls) and most liquid (6M ADV of US$11 mn) proxy to the resilient retail sector. CMT is also the largest REIT (by mkt cap) and the only REIT in STI to offer a 5.3% yield next year (post AEI).