Lock Mun Yee, an analyst from CGS-CIMB, reiterated the Buy rating on Elite Commercial REIT. The associated price target is £0.41.
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Lock Mun Yee has given his Buy rating due to a combination of factors that highlight the potential and stability of Elite Commercial REIT. The REIT reported a slight increase in gross revenue, driven by rental reversions and new acquisitions, which contributed to a higher distributable income and a 9.4% increase in distribution per unit. This financial performance, coupled with a high portfolio occupancy rate of 98.6%, underscores the REIT’s ability to maintain strong cash flows.
Furthermore, the ongoing projects, such as the conversion of Lindsay House into student accommodation, are expected to yield significant returns, enhancing the REIT’s value. The management’s strategy to re-gear leases and diversify debt maturity also adds to the financial stability and flexibility of the REIT. With an attractive dividend yield and the potential for further NAV uplift through property repurposing, Lock Mun Yee sees Elite Commercial REIT as a promising investment opportunity, despite the risks associated with tenant concentration.