Skip to content
Alpha Edge Investing

Alpha Edge Investing

"Investors operate with limited funds and limited intelligence, they don’t need to know everything. As long as they understand better than others, they have an edge.” – George Soros

  • Home
  • Earnings Updates/ Corporate Actions
  • Research – Equities
  • Research – Fixed Income/ Bonds
  • Research – Unit Trust/ ETF
  • News
  • My Opinions/ Views
  • Others
  • About Me
  • Contact
  • Disclaimer
  • Community and Support Forums
  • Toggle search form

Maybank: Mapletree Industrial Trust – Buy Target Price $3.00

Posted on October 12, 2022October 12, 2022 By alanyeo No Comments on Maybank: Mapletree Industrial Trust – Buy Target Price $3.00
Remains focused on ESG
Improving fundamentals, maintain BUY

Under our extended ESG 2.0 methodology, MINT receives an above-average score of 54 vs the 50 average. MINT’s sustainability framework is progressive, with targets validated by Net Zero (RCP 2.6) and Business-asusual (RCP 8.5) scenario analysis. We believe improvements in GHG emissions, further disclosure on renewable energy and green financing could help drive a higher score. Maintain BUY and DDM-based TP of SGD3.00 (COE: 6.6%, LTG: 2.0%). Maintain BUY.

GHG emissions driven by new data centres

MINT has an established framework and internal policies, but could further improve on its quantitative “E” metrics. We saw a large increase in MINT’s Scope 2 GHG emissions in FY21, mainly due to four additional data centres under operational control in North America. Notably, lower scope 2 emissions are observed in its Singapore portfolio and partially offset the overall increase. In our view, MINT needs to deepen its renewable energy efforts against the backdrop of utility rate hikes, taking assets such as data centres and hi-tech buildings into consideration. We believe scores could be higher with further disclosure on renewable energy usage.

Moving towards its ESG targets

In FY21, MINT made progress in rolling out sustainability clauses for new leases in high-tech and business park assets. Among its ESG targets, MINT has lowered electricity intensity by 9% (from FY20 basis), vs 15% target for its Singapore’s portfolio by 2030. Similarly, Scope 2 emissions in FY22 are
13% lower from FY20, against the 17% reduction target by 2030. Notably, ESG forms part of management’s remuneration.

Staying prudent

Gearing stands at 38.4% in 4Q22 and 1Q23, with the cost of borrowing at 2.5% (vs.2.4% in 4Q22). We expect a 50bps increase in interest rates, lowering DPU by <1%. Total borrowing is SGD2941m, 72.3% hedged at fixed rate. Green financing accounted for 13.4% of total borrowing in FY21; this data wasn’t published for FY22. Continued disclosure on green financing would be a plus.

Mapletree-Industrial-TrustClick here to Download Full Report in PDF

Share this:

  • Click to share on Twitter (Opens in new window)
  • Click to share on Facebook (Opens in new window)
  • Click to share on LinkedIn (Opens in new window)
  • Click to share on Telegram (Opens in new window)
  • Click to share on WhatsApp (Opens in new window)
Research - Equities Tags:Mapletree Industrial Trust

Post navigation

Previous Post: Maybank: Mapletree Logistics Trust – Buy Target Price $2.15
Next Post: Maybank: Singapore Exchange Ltd – Buy Target Price $10.65 (Previous $11.20)

Related Posts

UOBKH: Singapore REITs (Overweight) Research - Equities
DBS: Singapore REITs Research - Equities
UOBKH: Singapore REITs (Overweight) Research - Equities
DBS: Singapore REIT Research - Equities
UOBKH: REITs – Singapore (Overweight) Research - Equities
UOBKH: Mapletree Industrial Trust – Buy Target Price $3.36 Research - Equities
CIMB: Mapletree Industrial Trust – Add Target Price $2.97 (Previous $3.08) Research - Equities
DBS: Mapletree Industrial Trust – Buy Target Price $3.05 Research - Equities
UOBKH: REITs Singapore (Overweight) – Digi Core, Keppel DC, MINT Research - Equities
Edge: UOBKH disagrees with Chamos’s ‘big short’ on data centers, maintains ‘buy’ on DCR and MINT Research - Equities
DBS: Singapore REITs Research - Equities
DBS: Singapore Market Focus – Tactical bounce for rate hike casualties Research - Equities

Leave a Reply

You must be logged in to post a comment.

Login

Log In
Register Lost Password
Get new posts by email
Chat on WhatsApp
  • Earnings Updates/ Corporate Actions
  • My Opinions/ Views
  • News
  • Others
  • Research – Equities
  • Research – Fixed Income/ Bonds
  • Research – Unit Trusts/ ETF

Copyright © 2023 Alpha Edge Investing.

Powered by PressBook Grid Blogs theme