July 24, 2012

HwangDBS keeps 'buy' call on Axis REIT



HwangDBS Vickers Research has maintained its "buy" call for Axis Real Estate Investment Trust, with RM3.05 target price, backed by its attractiveness for its on-going asset enhancement.

It said the "buy" recommendation relied on its active approach to in-organic growth and stable portfolio of long-term leases and resilient asset profile including primarily warehouse and industrial properties.

"The second quarter 2012 core earnings were 31 per cent higher year-on-year at RM21 million, underpinned by higher turnover and net profit interest margin," the research house said in a statement today.

HwangDBS said the revenue grew 19 per cent year-on-year, underpinned by full contributions from the Seberang Perai Warehouse 3 and Bayan Lepas Distribution Centre.

Meanwhile, the 85 per cent net profit interest margin was attributed to lower costs associated with maintaining the above mentioned properties.

"As a result, the first half of 2012's RM41 million core net profit was in line with expectations," it added.

The trust declared 4.4 sen per unit distribution amounting to 96 per cent payout. -- Bernama

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