Friday, August 16, 2013

Fortune REIT

Fortune REIT: Stanchart view its recently acquired mall Kingswood Ginza, in Tin Shui Wai, has room for improvement in terms of trade mix, shopper-friendliness, and theme and positioning. In addition to being a community mall, Stanchart think Fortune should consider rebranding Kingswood Ginza into (1) a regional shopping centre, (2) a mid-end mall featuring outlets, or 3) a mall targeting mainland Chinese tourists. Stanchart conservatively estimate a modest impact on 2013E DPU, and mid-single digit yield accretion on DPU in 2014. House like Fortune’s moves aimed at enhancing future growth prospects. Trading at a 5.5% dividend yield, Fortune remains its top pick in the HK REIT space. Stanchart reiterate OUTPERFORM rating with TP HKD8.20.

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