Axis REIT earnings to remain resilient

Axis REIT earnings to remain resilient

The Star Online - Business·2020-10-22 09:05

KUALA LUMPUR: Maybank Investment Bank Research expects Axis REIT's earnings to remain resilient despite below-expected earnings in the third quarter of the financial year. The research house said 3Q20 net profit fell short of its estimates due to slower-than-expected timing of asset acquisitions. Earnings over the nine months period stood at 66% and 2% of Maybank IB' and consensus estimates. "We lower our FY20-21E net profit by 11% pa but maintain our 10-year DDM-TP of MYR2.25," it said, while reiterating its "buy" call and Axis as its top sector pick. Moving forward, Maybank IB expects Axis' industrial properties to provide recurring rental income due to long-term leases. It also believes its industrial properties' tenants are predominantly in less-cyclical industries such as logistics/warehousing and manufacturing. Industrial-related assets contribute about 91% to the current portfolio net lettable assets, said Maybank IB.

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