OUE / OUE Hospitality Trust

OUE / OUE Hospitality Trust: StanChart effectively recommends a switch from OUE to OUEHT. The house downgrades OUE from Outperform to Inline, cuts TP to $2.87 (from $3.58). Notes OUE has outperformed the sector by 10% ytd, with the listing of OUEHT. Says investors seeking exposure to Spore office and hotel sectors may prefer pure-play REITs with higher liquidity, given the uncertain mkt conditions. Sees limited upside surprise given the limited acquisition opportunities in Spore for OUE. Separately, StanChart initiates on OUEHT at Outperform with TP $0.98. Likes OUEHT, which owns a single hotel-cum-retail assets and offers 100% exposure to Orchard Road. OUEHT provides 7.6% annualized FY13e DPU yield, the highest among SREITs with predominantly Spore hotel and retail assets. The house expects 2013-15e DPU CAGR of 3.9% and organic NPI growth of 4.8% pa, which should be driven by a recovery in the Spore hotel sector and resilient growth in Orchard Road retail rents.