Axis-REIT's acquisition of Port Klang warehouse a positive move
In a report, RHB Research said the purchase was a proxy to the resilient and growing industrial property segment and maintained a 'buy' call on the group.
'While relatively small in scale, the acquisition supports the REIT's ongoing strategy of delivering consistent inorganic growth.
The purchase price implies a decent gross yield of 6.4% which is reasonable, since the asset is fully leased under a six-year term, and is strategically located within a key logistics hub,' it noted.
Concurrently, the research house raised its financial year 2027 (FY27) earnings by 1% to reflect the new rental contribution, while adjusting for additional financing costs.
'Given the minor earnings adjustment, we maintain our target price (TP) of RM2.23, implying a FY26 yield of 4.6%, which we think is fair, given the stable outlook for the REIT's industrial assets.'
BIMB Securities Research is also positive on the REIT, stating it was consistent with the REIT's strategy of expanding logistics exposure through high-quality, income-accretive assets.
It said, upon completion of the acquisition, earnings-accretion is expected from FY26, contributing approximately 1% to 2% to distributable income.
'The fully tenanted property ensures immediate rental visibility, while the 6.4% yield and modest gearing impact make it an earnings-accretive addition that supports the net asset value growth and solidifies the group's standing as Malaysia's leading industrial REIT,' it said.
On its outlook, BIMB Securities said the REIT's yield trajectory remains positive, underpinned by rental growth and a RM430mil acquisition target for 2025.
'Its acquisitive strategy should drive further value and income accretion. We maintain our 'buy' call with a TP of RM2.17.
'At RM2.01, the REIT offers an estimated 13% total return, combining an 8% price upside and a 5% yield, supported by continued portfolio expansion and earnings-accretive asset addition,' it noted.
Meanwhile, MBSB Research maintained its 'neutral' call on the REIT, noting it was slightly positive on the purchase of the warehouse as it is in line with its expansion strategy or Axis-REIT via asset acquisition.
'The acquisition is the first acquisition of Axis-REIT in FY25.
'We note that it is targeting to grow its portfolio via asset acquisition with estimated value of acquisition targets at RM430mil in the second quarter of FY25, while the latest asset acquisition marks the execution of the acquisition targets,' it said.
In revising its earnings. MBSB Research said it placed a higher TP of RM2.07 from RM2.06, based on a dividend discount model.
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