Starhill Global REIT, a mid-cap real estate investment trust, is projected to see a 10% upside in its stock value, according to an RHB note. The trust, which has a significant 70% exposure to the Singapore market, is expected to benefit from declining domestic interest rates and economic recovery. Recent strategic divestments have bolstered its balance sheet, whilst extensions of key master leases have enhanced its earnings profile. The stock is currently valued at 0.75 times its forecasted book value for the financial year 2026.
The trust’s stable distribution per unit (DPU) in recent years, despite market challenges, highlights its resilience. Analyst Vijay Natarajan has maintained a “BUY” recommendation, raising the target price from SGD0.55 to SGD0.60. This adjustment reflects the trust’s potential to capitalise on favourable market conditions and its strengthened financial position.
The trust’s focus on Singapore positions it well to leverage the country’s economic recovery. The recent divestments and lease extensions are seen as strategic moves to ensure long-term growth and stability. As the market anticipates further economic improvements, Starhill Global REIT’s attractive valuation and yield make it a compelling investment opportunity.
Looking ahead, the trust’s ability to navigate market fluctuations and maintain its earnings trajectory will be crucial. Investors are advised to consider the trust’s strategic positioning and financial health when evaluating its potential for future growth.
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