Excerpts from CGS International report
Mapletree Industrial Trust (SGX: ME8U)
- Mapletree Industrial Trust 3Q/9MFY25 DPU of 3.41/10.21 Scts is in line, at 24.7%/74.1% of our FY3/25F forecast.
- Mapletree Industrial Trust achieved positive reversions of 9.8% even as portfolio occupancy slipped to 92.1% in 3Q.
Reiterate Add with an unchanged TP of S$2.82.
3Q/9MFY3/25 results highlights
Mapletree Industrial Trust (MINT)Â reported a 2%/2.6% yoy rise in 3QFY3/25 revenue/NPI to S$177.3m/S$133.2m, respectively, on the back of contributions from Osaka DC and newly acquired Tokyo mixed use facility and new and renewal leases in Singapore and the US.
Distribution income to unitholders rose 2% to S$97.1m (DPU: 3.41 Scts, +1.5% yoy), inclusive of divestment gains from Tanglin Halt. MINT plans to continue its distribution reinvestment plans for 3QFY25 to enhance financial flexibility.
Mapletree Industrial Trust achieved positive rental reversions of 9.8% in 3QFY25
Overall portfolio occupancy dipped 0.8% pt qoq to 92.1% as take-up in the Singapore portfolio slipped 1% pt to 92.7% on lower occupancy in hi-tech, light industrial and stackup/ramp-up segments while its US portfolio saw a 0.6%-pt decline in occupancy qoq to 90.3%.
Mapletree Hi-Tech @ Kallang Way achieved a slightly higher committed occupancy of 57.6% at end-3Q. MINT saw positive weighted average rental reversion of 9.8% across all property segments in Singapore, with uplifts ranging from +5.4% to +14.4%.
MINT indicated that a portion of its FY26F lease expiry of 16.6% of its gross rental income comprises leases within its Singapore and US DC segment. While negotiations are ongoing, any delays or non-renewals could result in some frictional vacancy within its portfolio.
That said, we believe, given the supply outlook in Singapore and key DC hubs in the US, the majority of these leases would likely be largely re-contracted. On a more
positive note, weighted average lease expiry of the overall portfolio lengthened from 4.4 year to 4.5 years due to a lease extension of 5 years in the US portfolio.
Uptick in gearing due to new Tokyo acquisition
MINT’s gearing rose to 39.8% at end-3Q, following the completion of the acquisition of the Tokyo property in Oct 2024. All-in funding cost stood at 3.1% in 3Q, while adjusted interest coverage ratio is a healthy 4.3x over the same period.
In terms of strategy, MINT articulated during its results briefing that it would look to strengthen its portfolio through tenant retention, proactive capital management, accretive acquisitions and explore opportunistic divestment opportunities to rebalance its portfolio.
Valuation/Recommendation
Reiterate Add. We leave our FY25-27F DPU estimates unchanged and maintain our DDM-based TP at S$2.82. We continue to like MINT’s resilient portfolio metrics and attractive projected FY25F dividend yield of 6.3%.
Potential re-rating catalyst: better-than-projected rental reversions. Downside risks: non-renewal of DC lease expiries and global slowdown that could lead to a longer recovery period for vacancies and rentals.
You can find the full report here and the company website here.
