By now, many of you would have seen the numerous news articles and commentary pieces on CapitaLand’s $11 billion acquisition of Temasek’s subsidiary, Ascendas-Singbridge.
This combined entity creates Asia’s largest diversified real estate group and a global top 10 real estate investment manager, with over $116 billion of assets under management (AUM), including logistics/business parks, industrial, lodging, commercial, retail and residential spaces, in more than 180 cities across 32 countries.
CapitaLand Share Price
CapitaLand’s share price is currently $3.30, up about 7.5% since the start of the year. In contrast, the broader market, the Straits Times Index (STI) is only up about 5.1% since the start of the year.
In addition, here’s what the brokerage houses’ 12-month target price for CapitaLand looks like.
|Broker||Target Price||Potential Upside|
|OCBC Investment Research||$3.96||20.0%|
For investors, there are at least seven other SGX-listed stocks (apart from CapitaLand Limited) that are potentially impacted, including four from the CapitaLand family – CapitaLand Mall Trust, CapitaLand Commercial Trust, CapitaLand Retail China Trust, Ascott Residence Trust – as well as the Ascendas-Singbridge family – Ascendas REIT, Ascendas Hospitality Trust and Ascendas India Trust. These are all real estate investment trusts (REITs) and business trusts.
We look at the four that fall under the CapitaLand family.
CapitaLand Mall Trust(SGX: C38U)
CMT was the first real estate investment trust (REIT) to be listed on the Singapore Exchange (SGX) in 2002. Today, with a market capitalisation of $8.4 billion, it is still the largest retail REIT listed in Singapore.
While the Ascendas-Singbridge deal will not add any new properties in the pipeline for CMT, it may expedite acquisitions from CapitaLand, as the enlarged group gears to recycle assets and pursue new growth opportunities. This may include CapitaLand’s ION Orchard, Star Vista Mall or Sengkang Central Development.
Also listed on the Straits Times Index, CMT’s share price has held firm rising 1.0% since the start of 2019.
CapitaLand Commercial Trust (SGX: C61U)
With a market capitalisation of $6.9 billion, CCT is Singapore’s largest listed commercial REIT.
Similar to CMT, it too may benefit from an expedited acquisition pipeline from CapitaLand, including CapitaSpring and Funan Integrated Development. Unlike CMT, it potentially stands to benefit from an extended acquisition pipeline from Ascendas-Singbridge’s property portfolio, including ASB Tower in Tanjong Pagar and office properties in Korea.
Also listed on the Straits Times Index, CCT’s share price has risen 4.5% since the start of the year.
CapitaLand Retail China Trust(SGX: AU8U)
CRCT has a market capitalisation of $1.4 billion. When it was listed on the SGX in 2006, it was the first China shopping mall REIT with a portfolio of 11 retail properties.
Similar to CMT, which owns an 19.6% stake in CRCT, it may stand to benefit from an expedited acquisition timeline from the Ascendas-Singbridge acquisition.
Tracking CMT’s and CCT’s improvement in share price, CRCT’s share has added gains of 4.4% since the start of the year.
Ascott Residence Trust(SGX: A68U)
ART’s portfolio of global properties comprises 73 properties with 11,430 in 37 cities in 14 countries spanning Asia Pacific, Europe and the US. Listed in 2006, it has a market capitalisation of $2.5 billion.
Potentially, ART has the greatest overlap with the Ascendas-Singbridge portfolio of hospitality properties, which reside under Ascendas Hospitality Trust (AHT). AHT has a diversified portfolio of hospitality properties in gateway Asia Pacific cities such as Singapore, Australia, Japan and Korea. Synergies could likely be found that may benefit unitholders for both REITs, as well as CapitaLand. Of course, there is also the possibility of an expedited acquisition timeline for ART from the Ascott Group property portfolio.
ART’s share price has risen 6.5% since the start of the year.
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