K-REIT: Daiwa upgrades K-REIT to Hold from Sell following its unit-price correction over the past two mths. House note that REIT looks fairly valued now, relative to its new 6mth TP of $1.30, vs $1.35, with yields of 4.9%-5.6% on 2011-13 DPU forecasts. House revises down its DPU forecasts by 4.7% for 2011, 5.1% for 2012, and 2.2% for 2013 to include associate-level borrowing for ORQ, which house had not factored in following grp’s 4Q10 results….
On K-REIT's acquisition of more floors in Prudential Tower, Daiwa add that although it is marginally DPU-accretive with rental support and debt financing, the acquisition does not look like a bargain. Add that risk to its rating would be a disruption in the office sector recovery, while catalysts would be spot-rent rises above 10% for FY11
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