CRCT

CRCT: 3Q12 results. DPU was 2.42cts, +14% yoy. Annualized DPU was 9.63cts, which translates to yield of 5.9%, based on $1.635 last closing price. Gross revenue was Rmb 194.2m, +9% yoy, due to higher rental growth in CapitaMall Saihan, CapitaMall Qibao and CapitaMall Xizhimen. Net property income at Rmb 126.5m, +10% yoy. Excluding CapitaMall Minzhongleyuan, which is undergoing asset enhancement (expected completion by 2014), NPI grew 13%. In SGD terms, gross revenue was $38.6m, +14% yoy, and NPI was $25.2m, +16% yoy, mainly due to a stronger Rmb against SGD. Shopper traffic and tenant sales grew 21.5% and 15.6% respectively, while rental reversion across CRCT’s portfolio increased 18.2%. Portfolio occupancy was 97.5%, vs 97.1% qoq, and 97.7% yoy. Gearing remains comfortable at 30.4%. Mgt remains positive about the growth potential in China’s retail sector, supported by retail sales in China being projected to grow at ~15% pa from 2011-15, reaching Rmb 32t in 2015. The counter trades at 1.28x P/B.