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KUALA LUMPUR: Share prices of Hektar Real Estate Investment Trust, the retail-focused REIT in Malaysia, has been upgraded to RM1.44 from RM1.37 by OSK Research.
This is due to the general re-rating of REITs and the pick-up in the inflow of foreign funds into the country.
OSK Research said in a statement on Tuesday, Jan 11 that Hektar's unit price, now hovering at RM1.33 on the ACE market, had appreciated by as much as 7.0% since the middle of last year.
Among the catalysts to buoy the trusts' positive re-rating is that, it is one of the cheapest M-REITs, trading at a 8.2% per annum yield versus the sector's average of 7.6% and the inflow of foreign capital from advanced economies to this part of the world, including Malaysia.
M-REITs today not only offer higher yields relative to other more "traditionally-perceived" defensive asset classes, such as 10-year Malaysian Government Securities with a yield of 4.0%, but also the opportunity for investors to ride on the wave of domestic asset inflation, it said.
"The wealth effect from today's vibrant stock market as well as fast rising property prices may pique consumer spending, particularly on discretionary items is also another factor for its upgrading.
"Naturally, the retailers will benefit from this phenomenon and indirectly, landlords such as Hektar, in the form of stronger bargaining power for higher rental rates and higher collection from turnover rental from the retailers," said OSK. — Bernama
This is due to the general re-rating of REITs and the pick-up in the inflow of foreign funds into the country.
OSK Research said in a statement on Tuesday, Jan 11 that Hektar's unit price, now hovering at RM1.33 on the ACE market, had appreciated by as much as 7.0% since the middle of last year.
Among the catalysts to buoy the trusts' positive re-rating is that, it is one of the cheapest M-REITs, trading at a 8.2% per annum yield versus the sector's average of 7.6% and the inflow of foreign capital from advanced economies to this part of the world, including Malaysia.
M-REITs today not only offer higher yields relative to other more "traditionally-perceived" defensive asset classes, such as 10-year Malaysian Government Securities with a yield of 4.0%, but also the opportunity for investors to ride on the wave of domestic asset inflation, it said.
"The wealth effect from today's vibrant stock market as well as fast rising property prices may pique consumer spending, particularly on discretionary items is also another factor for its upgrading.
"Naturally, the retailers will benefit from this phenomenon and indirectly, landlords such as Hektar, in the form of stronger bargaining power for higher rental rates and higher collection from turnover rental from the retailers," said OSK. — Bernama
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