RHB maintains 'buy' on Cromwell European REIT, but lowers TP for first time in a year to EUR2.10

Nicole Lim2023-11-22

The analyst lowers his FY2023-FY2025 DPU to 3%-5% after fine-tuning finance cost and NPI margin assumptions, among others. RHB Bank Singapore analyst Vijay Natarajan has maintained his “buy” call on ...

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RHB Bank Singapore analyst Vijay Natarajan has maintained his “buy” call on ...</p>\n\n<a href=\"https://www.theedgesingapore.com/capital/brokers-calls/rhb-maintains-buy-cromwell-european-reit-lowers-tp-first-time-year-eur210?utm_source=Blog&utm_medium=RSS&utm_campaign=Tiger_Brokers_app_RSS\">Source Link</a>\n\n</div>\n","source":"edge_highlight","html":"<!DOCTYPE html>\n<html>\n<head>\n<meta http-equiv=\"Content-Type\" content=\"text/html; charset=utf-8\" />\n<meta name=\"viewport\" content=\"width=device-width,initial-scale=1.0,minimum-scale=1.0,maximum-scale=1.0,user-scalable=no\"/>\n<meta name=\"format-detection\" content=\"telephone=no,email=no,address=no\" />\n<title>RHB maintains 'buy' on Cromwell European REIT, but lowers TP for first time in a year to EUR2.10</title>\n<style type=\"text/css\">\na,abbr,acronym,address,applet,article,aside,audio,b,big,blockquote,body,canvas,caption,center,cite,code,dd,del,details,dfn,div,dl,dt,\nem,embed,fieldset,figcaption,figure,footer,form,h1,h2,h3,h4,h5,h6,header,hgroup,html,i,iframe,img,ins,kbd,label,legend,li,mark,menu,nav,\nobject,ol,output,p,pre,q,ruby,s,samp,section,small,span,strike,strong,sub,summary,sup,table,tbody,td,tfoot,th,thead,time,tr,tt,u,ul,var,video{ font:inherit;margin:0;padding:0;vertical-align:baseline;border:0 }\nbody{ font-size:16px; line-height:1.5; color:#999; background:transparent; }\n.wrapper{ overflow:hidden;word-break:break-all;padding:10px; }\nh1,h2{ font-weight:normal; line-height:1.35; margin-bottom:.6em; }\nh3,h4,h5,h6{ line-height:1.35; margin-bottom:1em; }\nh1{ font-size:24px; }\nh2{ font-size:20px; }\nh3{ font-size:18px; }\nh4{ font-size:16px; }\nh5{ font-size:14px; }\nh6{ font-size:12px; }\np,ul,ol,blockquote,dl,table{ margin:1.2em 0; }\nul,ol{ margin-left:2em; }\nul{ list-style:disc; }\nol{ list-style:decimal; }\nli,li p{ margin:10px 0;}\nimg{ max-width:100%;display:block;margin:0 auto 1em; }\nblockquote{ color:#B5B2B1; border-left:3px solid #aaa; padding:1em; }\nstrong,b{font-weight:bold;}\nem,i{font-style:italic;}\ntable{ width:100%;border-collapse:collapse;border-spacing:1px;margin:1em 0;font-size:.9em; }\nth,td{ padding:5px;text-align:left;border:1px solid #aaa; }\nth{ font-weight:bold;background:#5d5d5d; }\n.symbol-link{font-weight:bold;}\n/* header{ border-bottom:1px solid #494756; } */\n.title{ margin:0 0 8px;line-height:1.3;color:#ddd; }\n.meta {color:#5e5c6d;font-size:13px;margin:0 0 .5em; }\na{text-decoration:none; color:#2a4b87;}\n.meta .head { display: inline-block; overflow: hidden}\n.head .h-thumb { width: 30px; height: 30px; margin: 0; padding: 0; border-radius: 50%; float: left;}\n.head .h-content { margin: 0; padding: 0 0 0 9px; float: left;}\n.head .h-name {font-size: 13px; color: #eee; margin: 0;}\n.head .h-time {font-size: 11px; color: #7E829C; margin: 0;line-height: 11px;}\n.small {font-size: 12.5px; display: inline-block; transform: scale(0.9); -webkit-transform: scale(0.9); transform-origin: left; -webkit-transform-origin: left;}\n.smaller {font-size: 12.5px; display: inline-block; transform: scale(0.8); -webkit-transform: scale(0.8); transform-origin: left; -webkit-transform-origin: left;}\n.bt-text {font-size: 12px;margin: 1.5em 0 0 0}\n.bt-text p {margin: 0}\n</style>\n</head>\n<body>\n<div class=\"wrapper\">\n<header>\n<h2 class=\"title\">\nRHB maintains 'buy' on Cromwell European REIT, but lowers TP for first time in a year to EUR2.10\n</h2>\n\n<h4 class=\"meta\">\n\n\n2023-11-22 09:13 GMT+8&nbsp;&nbsp;&nbsp;<a href=https://www.theedgesingapore.com/capital/brokers-calls/rhb-maintains-buy-cromwell-european-reit-lowers-tp-first-time-year-eur210?utm_source=Blog&utm_medium=RSS&utm_campaign=Tiger_Brokers_app_RSS><strong>Nicole Lim</strong></a>\n\n\n</h4>\n\n</header>\n<article>\n<div>\n<p>The analyst lowers his FY2023-FY2025 DPU to 3%-5% after fine-tuning finance cost and NPI margin assumptions, among others. RHB Bank Singapore analyst Vijay Natarajan has maintained his “buy” call on ...</p>\n\n<a href=\"https://www.theedgesingapore.com/capital/brokers-calls/rhb-maintains-buy-cromwell-european-reit-lowers-tp-first-time-year-eur210?utm_source=Blog&utm_medium=RSS&utm_campaign=Tiger_Brokers_app_RSS\">Source Link</a>\n\n</div>\n\n\n</article>\n</div>\n</body>\n</html>\n","isBrief":false,"type":0,"news_type":1,"symbol":"BK6512","symbol_name":"房地产股","start_time":0,"source_url":"https://www.theedgesingapore.com/capital/brokers-calls/rhb-maintains-buy-cromwell-european-reit-lowers-tp-first-time-year-eur210?utm_source=Blog&utm_medium=RSS&utm_campaign=Tiger_Brokers_app_RSS","article_id":"2385069979","we_media_id":null,"thumbnails":[],"rights":null,"url":"https://stock-news.laohu8.com/highlight/detail?id=2385069979","pubTimestamp":1700615626,"sourceInfo":{"source_id":"edge_highlight","name":"Edge"},"weMediaInfo":null,"summary":"The analyst lowers his FY2023-FY2025 DPU to 3%-5% after fine-tuning finance cost and NPI margin assumptions, among others. ","collect":0,"end_time":0,"defaultTopTitle":"theedgesingapore.com","property":[],"viewcount":null,"language":"en","relate_stocks":{"BK6512":"房地产股","ESG":"FlexShares STOXX US ESG Select Index Fund","REIT":"ALPS Active REIT ETF","BK6072":"多样化房地产投资信托v","CWBU.SI":"Cromwell Reit EUR","CWCU.SI":"Cromwell Reit SGD"},"translate_title":"RHB维持对克伦威尔欧洲房地产投资信托基金的“买入”，但一年内首次将TP下调至2.10欧元","themeId":null,"isJumpTheme":false,"ttsUrl":null,"symbols_score_info":{"CWBU.SI":1,"CWCU.SI":1,"ESG":1,"REIT":1},"content_text":"The analyst lowers his FY2023-FY2025 DPU to 3%-5% after fine-tuning finance cost and NPI margin assumptions, among others. RHB Bank Singapore analyst Vijay Natarajan has maintained his “buy” call on Cromwell European REIT (CEREIT), but lowered his target price to EUR2.10 ($3.07) from EUR2.15 previously. \nThis follows the REIT’s 3QFY2023 ended Sept 30, which the analyst says was a “good quarter of financial and operational numbers that met expectations”.\nNatarajan notes that CEREIT’s portfolio occupancy remained high with healthy double digit rent reversions in 3QFY2023 and positive guidance. Its gearing has fallen to more comfortable levels on the back of its active divestment efforts. \n“Valuation decline is likely to be marginal in our view and the stock remains deeply undervalued at more than 40% discount to book value,” he says. \nThe REIT’s operational expense rose 14% q-o-q on the back of provisions for rental adjustment claims by the Italian government and higher service charge expenses. But this was more than offset by the 9% q-o-q decline in finance cost, on the back of loan repayments and release of tax accruals previously made in the Netherlands, resulting in a higher distributable income, says the analyst. \nIn 2023, CEREIT divested two Italian assets for EUR188 million and the proceeds used to pay down its higher cost revolving credit facilities. \nThis will result in a proforma net gearing decline to 37.4%, according to Natarajan. “We like management’s strategy of recycling its non-core assets and redeploying into higher yielding asset redevelopments/enhancements in a current high interest rate environment,” says the analyst. \nHe notes that the redevelopment of Nervesa is progressing well with about 70% pre-let ahead of\nits planned completion in 1QFY2. \nAs such, Natarajan lowered his FY2023-FY2025 distribution per unit to 3%-5%, by fine tuning his finance cost, net property income margin assumptions, and expectation of lower capital top up. \nThe REIT’s more transparent data disclosure and active sustainability efforts has led the RHB analyst to raise his environmental, social and governance (ESG) score to 3.3. This results in a 6% ESG premium to his dividend discount model-derived target price.\nUnits in CEREIT closed 1 EUR cent lower of 0.77% down at EUR1.29.","kind":null,"is_publish_news":null,"is_publish_highlight":null,"is_publish_live":null,"is_publish_wemedia":null,"editions":null,"symbols":[],"gpt_button":1},"commentList":[],"isCommentEnd":true,"newsSizeData":{"likeSize":0,"commentSize":0,"repostSize":0,"favoriteSize":0,"likeStatus":false,"favoriteStatus":false},"APP":{"userAgent":"Mozilla/5.0 AppleWebKit/537.36 (KHTML, like Gecko; compatible; ClaudeBot/1.0; +claudebot@anthropic.com)","isDev":false,"isTTM":true,"deviceId":"web-server-community-laohu8-v3","version":"4.22.4","shortVersion":"4.22.4","platform":"web","vendor":"web","appName":"ttm","isIOS":false,"isAndroid":false,"isTiger":false,"isTHS":false,"isWeiXin":false,"isWeiXinMini":false,"isWeiBo":false,"isQQ":false,"isBaiduSwan":false,"isBaiduBox":false,"isDingTalk":false,"isToutiao":false,"isOnePlus":false,"isHuaWei":false,"isXiaomi":false,"isXiaomiWebView":false,"isOppo":false,"isVivo":false,"isSamsung":false,"isMobile":false},"href":"/m/news/2385069979"}