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Sabana REIT: DPU of 3.04c.

Wednesday, April 27, 2011


While chatting with some friends, I mentioned that I expect a maiden DPU of no less than 2.8c for Sabana REIT. I also said that I could be wrong and the DPU could be higher. I am happy to be wrong and a DPU of 3.04c was announced. The REIT will go XD on 10 May and the income distribution will be made on 16 June.

Some important numbers:

NAV/unit: 98c.
Gearing: 24.9%
Interest cover ratio: 7.9x

See presentation slides here.

Not too long ago, I initiated a long position in Sabana REIT very close to its low and, similar, to my investment in Cache Logistics Trust, I would not be averse to some profit taking if its unit price were to rise meaningfully in the near future.


Immediate resistance is provided by the declining 50dMA at 94.5c. This is more likely than not to give way and the next resistance level is at 96c which is where we find the 100dMA as well as the 138.2% Fibo line, the first of three golden ratios. I am hopeful that we could see 98c tested as per my previous blog post on this REIT.

Related post:
Sabana REIT: Turning positive.


9 comments:

Persia said...

Hi AK71,

Congratulations!! This bumper dividend is even bigger than what I had hoped for, but I don't think any shareholders will be complaining.. ;)

Separately, another counter that I am following made an announcement today to inform of the book closure date for a 12% dividend payout. XD is next Friday. Feel free to read more in my blog posting at http://kiasuinvestor.blogspot.com/2011/04/hot-on-hotung-part-2-12-dividend-payout.html

AK71 said...

Hi Persia,

I am sure fellow unit holders are pleased with the results. What's not to like, right? ;)

Anonymous said...

Good news that greeds this sleepy eyes. BUT i am worried that this high DPU is a publicity stunt. Just a hunch to generate more interest in this unique counter. Just hoped that it is sustainable for looooong time to come.

SnOOpy168

Anonymous said...

http://sabana.listedcompany.com/news.html/id/250533

XD : 13/05/2011
Date Paid/Payable: 16/06/2011

SnOOpy168

AK71 said...

Hi SnOOpy168,

Nope. This is not a publicity stunt. The higher DPU represents income from the date of listing in November to end March 2011. From the next quarter on, it would normalise as only income received for three months from April to June would be distributed. :)

Hwang said...

As for gearing, Islamic related such as Sabana cannot go beyond 35% compare with the conventional 45%. If so, acquisition through loans will be limited, and most likely through rights.

Is that possible?

AK71 said...

Hi Hwang,

I think we could have misunderstood why Sabana REIT is unable to gear beyond 35% initially, myself included.

The following is found on page 60 of its Prospectus:

Under the Property Funds Appendix, Sabana Shari’ah Compliant REIT is permitted to borrow up to 35.0% of the value of the Deposited Property at the time the borrowing is incurred, taking into account deferred payments (including deferred payments for assets whether to be settled in
cash or in Sabana Shari’ah Compliant REIT Units). However, the Property Funds Appendix
allows Sabana Shari’ah Compliant REIT to borrow more than 35.0% (up to a maximum of 60.0%) of the value of the Deposited Property if a credit rating from Fitch Inc., Moody’s or Standard & Poor’s is obtained and disclosed to the public. As at the Listing Date, Sabana Shari’ah Compliant REIT is expected to have borrowings of S$220.6 million with an Aggregate Leverage of 26.5%.

Anonymous said...

Sabana Reit has now been included in the MSCI index

http://www.bernama.com.my/bernama/v5/newsbusiness.php?id=590681

New properties will be added to their portfolio soon.

AK71 said...

Dear Anonymous,

Thanks for sharing the link. :)

Could you include your name or initials in future comments?

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