OUE Hospitality Trust

OUE Hospitality Trust: DBSV initiates with an Equity Explorer report, with a fair value of $0.93. OUE HT is a Singapore-based REIT with an initial portfolio of two properties in prime locations - the 1051- room Mandarin Orchard Hotel, and the accompanying Mandarin Gallery retail mall. The properties are collectively worth $1.7b as of 31 Mar13. The Trust has resilient earnings structure with strong visibility. Multiple growth drivers are also in place. While earnings are sensitive to RevPAR changes, we expect earnings volatility to RevPAR changes to be limited given a high % of income pegged to fixed rates. In addition, yields of 7.6%-8.0% are higher than S-REIT peers.