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UOB KAYHIAN |
LIM & TAN |
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NTT DC REIT (NTTDCR SP) Lucrative Yield With Incremental Upside From Asset Injections
Highlights • NTTDCR is planning a potential acquisition of a hyperscale data centre in Frankfurt, Germany with NPI yield of 6% and WALE of 10 years in 1H26 . • Portfolio occupancy could improve as much as 2.5ppt to 97.7% in 2HFY26 due to scheduled ramp-up by existing tenants and addition of new tenants. • NTTDCR’s largest tenant is a Fortune 100 US EV company. Its recent launch of an autonomous humanoid robot could create more demand. Initiate coverage with a BUY recommendation and target price of US$1.42.
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The Board of China Aviation Oil / CAO ($1.65, unchanged) wishes to announce that it has been informed by CNAF on 8 January 2026 that, following deliberation by the State-owned Assets Supervision and Administration Commission of the State Council of the People’s Republic of China and with the approval of the State Council, China Petrochemical Corporation and CNAF will proceed with corporate restructuring (the “Restructuring”). At CAO’s last traded price of $1.65, the stock is capitalized at $1.4bln, forward PE is 11.1x, ex-cash PE is very attractive at 6.6x while normalized dividend yield is 3% (we understand that there is a good chance for special dividends to be dished out once the restructuring process is over). Given the robust air traffic in 2025, we see potential for consensus earnings beat for CAO when they announce their FY2025 results at the end of Feb’26 and there could also be a dividend surprise as a result. Given both positi ve fundamental and speculative appeal on CAO, coupled with its undemanding valuations especially taking into account its solid and robust balance sheet, we thus maintain an Accumulate rati ng on CAO (and have the stock as our Top Alpha pick for FY2026) and we have a 1-year target price of $1.80 for the stock. |
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MAYBANK KIM ENG |
MAYBANK KIM ENG |
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Coliwoo Holdings (COLIWOO SP) Unlocking growth
Riding on the fast-growing co-living sector Coliwoo is one of the largest co-living players in Singapore, with about 2,933 rooms spread across 25 strategic locations in Singapore, including 714 rooms that are undergoing renovation and are not yet operational. The country’s safe-haven status as a regional business, medical and educational hub makes co-living a preferred option for many young professionals and students given flexible lease terms and unique value propositions. We are initiating coverage of Coliwoo with a BUY and 12- month TP of SGD0.74, based on 15x FY26E P/E.
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Malaysia REITs Tourism-driven uplift, portfolio refresh to sustain yield
POSITIVE stance supported by income visibility We maintain a POSITIVE stance on the Malaysia REIT sector into 2026, supported by resilient fundamentals, a stable rate environment and tourism-led demand recovery. While earnings growth is expected to normalise after a strong 2025, income visibility remains high on healthy occupancies, positive rental reversions and prudent balance sheet management. We forecast CY26E earnings growth of ~9% YoY, led by retail and hospitality, with Pavilion REIT and CLMT as our top picks. The key downside risk is uncertainty over the WHT concession, with potential posttax yield compression of ~50–100bps if not extended.
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| DBS GROUP RESEARCH | |
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TECHNOLOGY
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