AIMS AMP Capital Industrial REIT: REIW 2010.

AIMS AMP Capital Industrial REIT made a presentation yesterday at the Real Estate Investment World 2010 at the Raffles City Convention Centre. Presenting itself to potential investors at the Convention was a very good idea.  Present at the Convention were pension funds and asset managers. I won't be surprised if they are looking to invest in high yielding S-REITs too. Link to the Convention's homepage here.

These were a few points made by the REIT's managers which I like very much:

1.  Asset recycling and asset management programmes:

– Divestments: (i) Japan property; and (ii) one or more of the smaller Singapore properties.
– Redeploy the net divestment proceeds into (i) debt repayment and / or (ii) acquisitions.
– Focus on positive leasing outcomes and enhance selected assets in the portfolio.

2.  Refinancing of the existing S$175 million debt facility with improved financing terms.


3.  Broaden and diversify the Trust’s funding sources.

4.  Target investment grade credit rating of Baa3 or above (current rating of Ba2) by maintaining strict financial discipline and investment grade metrics.

Why do I like these points in particular? These actions, if carried out singly or in sum, could strengthen the REIT's balance sheet, improve EPS, improve DPU, increase the REIT's resilience in the face of future economic slowdowns and attract institutional investors although these benefits might not all happen at the same time.

Based on the fundamentals, accumulating at 21.5c per unit for a 10% annualised yield is rather sound.  Based on near term technicals, 21.5c is resistance turned support.  However, the longer term technicals suggest that the REIT is still in a trading range between 20c to 23c. With momentum still somewhat lacklustre, its price is unlikely to make any big moves in the near term.

To view the complete presentation slides for Real Estate Investment World Asia 2010 Conference, click here.

Related post:
AIMS AMP Capital Industrial REIT: Big boys.

Charts in brief: 22 Jun 10.

NOL: Sell signal seen on the MACD histogram. So, will the price fall for sure? I cannot say but the negative divergence between price and volume has to be resolved.  There should be a pretty strong support at $1.95, a many times tested resistance of a mini ascending triangle pattern. $1.95 is also where we find the rising 100dMA at the moment.

NOL off lows; Low-risk container shipping play, says UOB
Tuesday, 22 June 2010

© 2010 - The Edge Singapore

AIMS AMP Capital Industrial REIT: OBV shows steady accumulation. MFI has formed a lower high in the very short term. MACD has crossed into positive territory. If the MFI could gradually fall while the price remains at or above the 21.5c support, it would be good news for bulls.

CapitaMalls Asia: A black spinning top and a bearish harami to boot. A possible pullback to $2.13 where we find the trendline support and the 50dMA is not hard to imagine. Rising positive buying momentum as suggested by a rising MFI should limit any selling pressure.

Courage Marine:  MFI and OBV continue to rise sharply as volume almost tripled on a day that saw price hit a high of 21c.  21c was identified earlier as a strong resistance and it could not be taken out today.

Charts in brief: 21 Jun 10.

Most counters in my watchlist are positive today as the STI gained to close just a whisker off 2,880. It would seem that the Chinese government has done the world a great favour by deciding to let the RMB strengthen. This is something I have believed should happen for some time. A stronger RMB would ameliorate the problem of inflation within China, raise the purchasing power of its people and improve standards of living. Increased domestic consumption would do a lot of good for China's own economy as well as the global economy. You might want to read what I wrote in an earlier post here.

STI +1.6%; More upside on window-dressing, says SIAS
Monday, 21 June 2010

© 2010 - The Edge Singapore

AIMS AMP Capital Industrial REIT: Volume expanded today and all trades were done at only one price, 22c. MACD has turned up.  MACD histogram has a buy signal. MFI has turned up, forming a higher low. OBV has turned up, suggesting increased accumulation.

CapitaMalls Asia: Price broke the resistance band of $2.19 to $2.21 which I identified earlier. Closing at $2.22 seems bullish but volume suggests that this might not be durable. This counter is probably rising due to a lack of sellers rather than an abundance of buyers. Nonetheless, the momentum is still good as suggested by the MFI and price might be pushed higher.

Courage Marine: The picture is somewhat similar to CapitaMalls Asia.  A white candle day on improved volume but not impressively so which suggests a lack of sellers rather than an abundance of buyers. MFI shows improving momentum while the OBV has turned up slightly.  It remains to be seen if resistance at 20c could be taken out. A significant resistance after 20c is at 21c.

FSL Trust: MFI and OBV continue to rise. Could 40c be taken out this week? The next resistance level which is likely to be a strong one as suggested by candlesticks and a declining 20dMA is at 42c.

Golden Agriculture: Price continues to be resisted at 55c although it touched a high of 55.5c today. Momentum is still positive and MACD is about to cross into positive territory. Volume is, however, unimpressive which probably resulted in the failure to take out 55c and instead formed a white spinning top which is a possible reversal signal.  Support is at 51.5c in case of a trend reversal.

LMIR: It seems that the merged 100d and 200d MAs are too strong to be taken out today. Price closed at 47.5c which is where we find the 50dMA, forming an inverted cross in the process. The negative divergence between price and volume continues to suggest LMIR has been rising on weak technicals. If the 50dMA does not hold up as support, the next support is at 46c as provided by the 20dMA.

Related posts:
AIMS AMP Capital Industrial REIT: Big boys.
Courage Marine: Triple bottom?
Golden Agriculture: Resistance remains at 55c.
LMIR: Testing resistance.
FSL Trust: Verona I.

AIMS AMP Capital Industrial REIT: Big boys.

This REIT is generally thinly traded but on some days trading volume would spike.  In recent weeks, I have noticed quite a few single large volume buy ups.  These buy ups were usually to the tune of millions of units. This morning at 11.27AM, 2,825,000 units were bought up at 22c. Again, a single large volume buy up.

I went through the manager's annual report over the weekend and they have a very clear idea on the REIT's direction and what they will do in time. They want to offload their Japanese property and concentrate on Singapore.  They want to offload some underperforming properties in Singapore too.  If they manage to divest these properties, they might pay down the REIT's loans or look for better prospects within the industrial real estate sector in Singapore.  In time, they want to venture into high growth China.

Looking at the OBV, it is obvious that there has been steady accumulation in recent times although the momentum has not always been positive. Has this REIT, with its relatively high yield, low gearing and big discount to NAV, heightened the interest of big boys?

A quick check on SGX's website reveals the following:
3 June 10 - APG ALGEMENE PENSIOEN GROEP N.V.  increased its stake from 8.935% to 9.307%. That was their second major purchase within a short time.  An earlier major purchase happened end of May which bumped up their stake from 7.862% . They currently own about 136,501 lots.

Given such a consideration, for anyone who is thinking of buying into this REIT, hedging with a position initially at or close to 21.5c resistance turned support might be a good idea.  It would be sweet to buy closer to the support of the trading range which remains at 20c. However, it might or might not happen.  Hedging is probably again the way to go.