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Business Times
4 days ago
- Business
- Business Times
Phillip Securities initiates coverage on dividend-focused Reit ETF trading at ‘attractive' valuation
[SINGAPORE] Phillip Securities Research has initiated coverage on the Phillip SGX APAC Dividend Leaders REIT ETF (Pareits) with an 'accumulate' call and a target price of S$1.095. In a report released on Wednesday (May 28), Phillip Securities analyst Helena Wang said that the exchange-traded fund (ETF) offers investors stable income at an attractive book value. 'The book value of the ETF has become more attractive in the last two years,' added Wang. 'It historically traded at a high of 1.3 times price-to-book (P/B) ratio but now trades at 0.8 times P/B ratio.' She also noted that Pareits' dividends have steadily increased since 2021, and are now at around four to six Singapore cents per unit. Its dividend yield stands at around 4.4 per cent. Wang expects an improvement in distribution per unit as interest rates decline. The target price of S$1.095 was derived from an equal weighting of two valuation methods. A historical dividend yield spread derived a target price of S$1.22, and a P/B ratio assessment derived a target price of S$0.97. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The ETF tracks 31 real estate investment trusts (Reits) across the Asia-Pacific, excluding Japan. The geographic coverage is largely skewed to Australia, which accounts for 52.5 per cent of the portfolio allocation. Singapore and Hong Kong account for 34.8 per cent and 11.5 per cent, respectively. Some 37.6 per cent of the ETF is allocated in the retail sub-sector, with 29.5 per cent in diversified assets, 13.3 per cent in industrial properties and 10.8 per cent in the office space. The top three holdings of Pareits are Hong Kong's Link Reit at 10.6 per cent, Australia's Scentre Group at 9.8 per cent, and Singapore's CapitaLand Integrated Commercial Trust at 7.6 per cent. 'Pareits tracks the iEdge Apac ex-Japan Dividend Leaders Reit Index, which weighs Reits based on their dividend payout. This makes it the best choice for investors looking for high dividend payments,' Wang said. The ETF is the smallest among the five Reit ETFs listed on the Singapore Exchange, with a fund size of just S$11.9 million as at May 27. It also has the highest expense ratio at 0.95 per cent. The fund is managed by Phillip Capital Management. Both Phillip Capital Management and Phillip Securities Research are part of the PhillipCapital Group. As at 4 pm on Thursday, units of Pareits were trading 6.4 per cent or S$0.007 higher at S$1.097. Year to date, it has generated a total return – with dividends reinvested – of 5.5 per cent. This is broadly in line with the 5.6 per cent total return of the benchmark Straits Times Index over the same period.
The Star
24-04-2025
- Business
- The Star
Singapore shares set for an eight-day rally; Asia FX muted
The Straits Times Index surged 8.2 per cent when trading opened. The STI has dropped 14.2 per cent since Trump announced the sweeping tariffs on April 2. - ST Singapore equities were set for an eighth straight session of gains on Thursday, marking their best winning streak since November 2022, as cooling inflation and demand for defensive stocks supported the benchmark index. The country's low baseline reciprocal tariff of 10%, along with a construction boom, falling interest rates, and increased fiscal support, will help cushion the impact of the trade war, Maybank analysts said. The island-state also reported its lowest core inflation print in four years on Wednesday, reflecting lower prices of household goods and utilities ahead of a national election. Gains in Singapore stocks are likely driven by the market's safe-haven appeal amid global trade volatility, with investors shifting toward high-yield sectors like telecommunications, utilities, and defence, Phillip Securities Research analyst Zane Aw said. Currencies in the region were trading in a tight range, while a relief rally in stocks lost momentum after mixed signals on China tariffs by U.S. President Donald Trump's administration. Shares in Taipei fell 0.8% after a massive 4.5% gain on Wednesday while equities in South Korea and Thailand dropped 0.1% and 0.2%, respectively. Stocks in Philippines and Indonesia dropped 0.2% each. Among currencies, the South Korean won was the top loser, dropping 0.6% against a steady U.S. dollar. The Thai baht, Taiwan dollar and the Indonesian rupiah were all about 0.1% lower. Elsewhere, the view on Malaysia was more upbeat as rate cut bets mounted after it reported weaker-than-expected gross domestic product last week, coupled with the general unease around trade. Citigroup continued to see a 30% chance of the Malaysian central bank cutting interest rates by 25 basis points in May and July each, it said in a note. "Despite fundamental support for an arguably undervalued ringgit, tariff headwinds argue for willingness to allow ringgit as a shock absorber." The Malaysian central bank governor said the nation would need to revise its annual growth forecast downward due to tariff and trade uncertainties. The country faces a 24% tariff in July on its exports to the U.S. unless a deal is struck between the two countries. HIGHLIGHTS: ** Indonesia 2025 growth seen around 5% despite trade tensions, finance minister says ** Singapore's high-yield stocks gain from tariff-induced flight to safety ** Philippines stands to benefit from US tariff shake-up, but must address constraints, study shows - Reuters
Wall Street Journal
07-04-2025
- Business
- Wall Street Journal
Hong Kong, Taipei on Track for Historic Losses
There is no place to hide in Asia, with all major stock markets getting hammered as of early Monday afternoon trading. Worst-hit is Hong Kong's Hang Seng index, down around 11% and on track for its biggest one-day percentage loss since the 2008 global financial crisis. Markets in Tokyo, Shanghai and Singapore are down more than 5%. Taipei's Taiex index is down 9.7%--which, if maintained, would be its worst one-day fall since 1990. 'The U.S. ignited a global trade war,' Phillip Securities Research's Paul Chew said in a commentary. 'The risk of recession is high. We worry Trump has kicked start a negative feedback loop of cautious consumers and businesses that will spend less.'
