Frasers Centrepoint Trust (FCT) has reported a promising set of third-quarter operational results, prompting analysts to maintain a “buy” recommendation and increase the target price to S$2.50. The trust, which focuses on suburban retail properties in Singapore, has shown sequential improvements across all key metrics, with tenant sales on the rise due to asset enhancements and government incentives.
The trust’s borrowing costs are expected to decrease significantly, which is anticipated to boost the distribution per unit (DPU). Analyst Vijay Natarajan noted that asset enhancements are likely to be a major growth driver for FCT. He also mentioned that potential risks from the upcoming Johor Bahru-Singapore Rapid Transit System are considered manageable.
The trust’s strategic focus on suburban malls, which are well-located and have a strong catchment area, positions it favourably in the market. With a current yield of approximately 5.5%, FCT remains an attractive investment for those seeking exposure to the resilient Singapore retail sector.
Looking ahead, the trust’s management is expected to continue leveraging asset enhancements to drive growth, whilst maintaining a strong portfolio that benefits from Singapore’s economic recovery. The positive outlook and strategic initiatives suggest that FCT is well-positioned to capitalise on future opportunities in the retail sector.
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