Frasers Centrepoint Trust: Strategic Acquisitions and Strong Performance Drive Buy Rating

Analyst Jonathan Koh of UOB Kay Hian maintained a Buy rating on Frasers Centrepoint (FRZCF – Research Report), with a price target of S$2.73.

Jonathan Koh has given his Buy rating due to a combination of factors influencing Frasers Centrepoint Trust’s (FCT) performance. The trust has shown resilience with a reported distribution per unit (DPU) of 6.054 Singapore cents for the first half of the fiscal year 2025, which slightly exceeded expectations. This performance was driven by a positive rental reversion of 9.0%, particularly from key properties like Causeway Point, Tampines 1, and Century Square, along with a 3.3% year-over-year increase in tenant sales, bolstered by asset enhancement initiatives at Tampines 1.
Additionally, the strategic acquisition of Northpoint City South Wing (NCSW) aligns with FCT’s focus on dominant suburban malls and is expected to enhance the pro forma FY24 DPU by 2.0%. NCSW’s location in a densely populated area with limited retail supply and its superior performance compared to other suburban malls further support the Buy rating. The acquisition is anticipated to benefit from population growth in the catchment area, with significant residential developments underway, promising a robust future for FCT’s portfolio.

In another report released yesterday, CGS-CIMB also reiterated a Buy rating on the stock with a S$2.70 price target.