CapitaMall Trust

CapitaMall Trust: Recall that 3Q11 DPU +2.5% to 2.42c vs 2.36c yoy due to additional contributions from new acquisition, Iluma which it acquired on April 1. Ratings are as per follow:

Citi maintain N, TP $2.00, fine-tuned rental revenue for the individual malls and have reduced DPU estimates largely to reflect the higher-than expected finance cost which was attributed to the acceleration of the option value and transaction costs from the redemption as well as cancellation of S$87.75m of CB due 2013.

Deutsche maintains Hold, TP $1.98, expect earnings to be fairly resilient with growth supported by multiple AEIs. Valuations fair at 1.2x P/B and 5.1% FY11e yield implying a relatively tight 345 bps over the 10-year bond.

Nomura maintain Neutral, TP $1.96, currently trading at 1.2x FY12F book value and 5% FY12F dividend yield. At 1.2 PBV, the stock is not cheap vs avg 0.97x FY12F PBV that other REITS are trading at.

CS maintain O/p, TP $2.22, balance sheet is healthy with the next refinancing only due in Oct-12. Gearing at 38.4% (40% of management target), CT is top S-REIT pick for its resilience.

BNP maintain Buy, TP $2.09, continue to favour S-REITs to S-developers; Prefer retail within SREITs. Potential concerns include tighter credit and capital markets.

Daiwa maintain Hold, TP $1.90, premium valuations look fair, 3Q11 results in line; resilient DPU growth, boosted by asset enhancements, are in the price. More visibility on Iluma's asset enhancement plans.

Goldman maintain Neutral, TP $2.18, premium valuation of 1.2X fwd P/B is balanced by its above-sector DPU growth and exposure to nondiscretionary retail income. CMT offers visible growth with its disciplined AEI rollouts in 2012/13 – Iluma, to commence in Nov and to be completed by Jun 2012, should see yield on cost improve to 5.8% from 3.8% and ROI of 22.4%. Prefer

RBS maintain Buy, TP $2.19, top pick for the sector as it has a good retail portfolio and strong balance sheet.

UBS maintain Buy, TP $2.06, cautious tone on market outlook, think CT may rollover the S$7.7m tax-exempt retained income (0.24¢) to FY12 to buffer potential DPU volatility from an economic slowdown.