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Singapore stock market and companies daily report (Dynasty REIT, LMIR Trust, ST Aerospace) (October 11, 2012)

Contributed by Shares Investment

Dynasty REIT – S’pore’s First Dual-Currency IPO
Dynasty REIT, backed by Hong Kong billionaire Li Ka Shing and sponsored by ARA Asset Management, is set to raise approximately $1.1 billion in a dual-currency listing as Singapore’s first yuan- denominated initial public offering (IPO). When the REIT is listed, its units will have two trading counters – a primary one in yuan and a secondary one in Singapore dollars. Units traded through both counters will be identical to one another. Dynasty REIT’s portfolio currently consists of three commercial properties in China – Nanjing International Finance Center, Dalian Tianxing Roosevelt Center and Shanghai International Capital Plaza – with a total gross floor area of about 350,476 square metre (sqm). Of the total, about 243,657 sqm is lettable. The three properties have an average independent valuation of about Rmb 7.7 billion. For 2013, distribution per unit is expected to range from Rmb0.32 to Rmb0.33, resulting in a yield of 7 to 7.3 percent.
Significance: Dynasty REIT will offer investors unique exposure to the potential appreciation of the yuan, which had appreciated about 28 percent against the US dollar from 2005 to 2011, at a compounded annual growth rate of 4.3 percent.

LMIR Trust Expands Portfolio By 4 For $180.7m
Mainboard-listed Singapore-based REIT, Lippo Malls Indonesia Retail Trust (LMIR Trust) plans to buy four retail mall assets in Indonesia for about 1.4 trillion rupiah ($180.7 million). Boosting its portfolio to 14 retail malls, valued at about 12.3 trillion rupiah, with a combined lettable area of 637,664 square metres. The four acquisition targets are namely: Palembang Square and its one-level underground extension, Tamini Square and Kramat Jati Indah Plaza. LMIR Trust said: “The acquisition represent an opportunity for it to acquire income-producing quality properties below their independent valuation.” After the acquisition, the maximum contribution to LMIR Trust’s net property income by any single property within LMIR Trust’s property portfolio is expected to decrease to around 15 percent. LMIR Trust plans to finance the acquisitions from proceeds raised from its issuances of the $200 million 4.9 percent notes due 2015, and $50 million 5.9 percent notes due 2017, under its $750 million Euro Medium Term Note programme.
Significance: LMIR Trust expects the acquisition to deliver economies of scale to the marketing and leasing activities, by expanding and deepening its relationships with existing tenants of the four properties who are currently not tenants of LMIR Trust’s malls.

ST Engineering’s Aerospace Subsidiary Notches Up $590m in Contracts
ST Aerospace, the aerospace arm of Singapore Technologies Engineering (ST Engineering), picked up new deals totalling $590 million in 3Q12 for airframe, component and engine maintenance and engineering design support. This is in addition to it securing a US$80 million contract in July 2012 for the repair and maintenance of Malaysian low cost airline AirAsia’s aircraft components. For 3Q12, ST Aerospace redelivered its first VIP Boeing business jet for a contract secured for light checks and interior modifications. It also completed airframe maintenance and modification work on 156 aircraft. Its Singapore component repair and overhaul facility also added capabilities for the Airbus A320, A330, A340 and Boeing 77 platforms. In Guangzhou, China, ST Aerospace commenced hangar construction for its airframe maintenance, repair and overhaul joint venture. It is expected to be operational ready in 3Q13.
Significance: With a myriad of activities going on at its Aerospace arm, its Aerospace business segment is expected to post a bumper quarter – 3Q12, and continue its revenue growth trend which increased 8 percent between 1Q12 and 2Q12.