Largest IPO in 2 Years - Mapletree Greater China Commercial Trust

First of many IPOs this year we hope. After a couple of months without a large IPO, the IPO market in Singapore looks set to heat up again with the proposed listing of Mapletree Investment's Mapletree Greater China Commercial Trust. In fact, it is the largest IPO in 2 years.


Summary of offering

• IPO to raise up to S$1.68 billion to purchase 2 China-based commercial property assets from Mapletree Investments
• The biggest IPO of 2013 and the biggest trust IPO since Hutchinson Port Holdings Trust that raised US$5.5 billion in 2011
• Assets are Greater China-based
• Beijing Gateway Plaza
• Hong Kong Festival Walk
• Strong brand name in Singapore with experience in office, logistics, industrial, residential and retail properties
• 45 assets in Singapore
• 20 assets in China
• 9 assets in Hong Kong
• 32 assets in Japan, India, South Korea, Malaysia and Vietnam
• 23 commercial-linked properties
• Figures and numerics
• raising up to S$1.68 billion 
• indicative price range of S$0.88-S$0.93
• Use of proceeds
• No exact break-down so far but cash raised will be used to buy the 2 properties from Mapletree Investments.
• Dividend policy
• Semi-annual
• 5.6-6% for the first year
• 6.1-6.5% for the second year
• 100% of distributable income until March 2015. At least 90% of disctributable income thereafter.
• Cornerstone shareholders
• Temasek Holdings - 851.7-931.6 million shares
• 953.5 million shares to be shared among
• Morgan Stanley
• Norges Bank Investment Management
• AIA Group
• CBRE Group
• Henderson Global Investors
• 776.6 million shares for institutional and retail investors
• Timeline for offering
• 18 Feb - Offer to institutional buyers
• 28 Feb - Offer to public
• 7 Mar - list on SGX

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Commentary

Brand name
Mapletree is pretty much a big brand name in Singapore akin to Ascendas, both of which are government-linked. It is noteworthy to realise that Mapletree Investments manages a portfolio valued at S$19.9 billion. They have ample management experience in office, logistics, industrial, residential and retail.

China + Commercial Experience
The current IPO is a divestment of 2 China-based commercial assets into a REIT. China is not a new destination for Mapletree as they already easily manage 20 assets in China such as the Mapletree AIP in Guangzhou under Mapletree Logistics Trust. Out of these assets, 6 are commercial-related properties - Beijing Gateway Plaza, Hong Kong Festival Walk, Shanghai Silver Court, Nanhai South Station Enterprise City, Minhang Development Project and Nanhai Business City. The rest are mostly logistics and industrial with some residential properties. Having said that, Mapletree also has considerable commercial property experience outside of China with 7 other assets spread over Japan, Vietnam, Malaysia.

Quality of assets
Both are Grade-A offices in the heart of China and Hong Kong with size more than 100,000 sqm. They also consist of some retail space located at the base of the assets. Festival Walk was purchased by Mapletree Investments in 2011 for $2.4 billion.

Current REIT market conditions
REITs are clearly the outright winning category of 2012 as investors flocked to yield havens, resulting in a yield compression that we see today. Even so, REITs have still enjoyed considerable upside to the start of 2013. Mapletree brand name REITs have also done well in the current market conditions, surging even further in the last 2 days upon the announcement of listing of this REIT.

• Mapletree Commercial (listed 2011) - $1.445 15 Feb closing price compared to IPO offer of $0.88
• Mapletree Industrial (listed 2010) - $1.390 15 Feb closing price compared to IPO offer of $0.93
• Mapletree Logistics (listed 2005) - $1.240 15 Feb closing price compared to IPO offer of $0.68

And, for a tabulation of all SG-listed IPOs' performance since 2012, do visit "SG IPO Statistics" on this HealthyTrading blog. It presents an easy snapshot of all the IPOs at a glance for your analysis and comparisons.

For those of you gunning for this Mapletree Greater China Commercial Trust IPOs, check out my blog page on "Guide to IPO Investing" to help you navigate around especially if you are a new investor or new to the IPO bidding system of SGX. Do not waste time; time is ticking away to those offer deadlines!

Also, do bookmark this page // add Healthytrading blog to Twitter // subscribe to RSS feed // subscribe to email feeds to receive the LATEST IPO/market news that will move your money. Links are available all on the right of the page (at the navigation bar).

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Gaining Steam - Biosensors

[Previous post: Large Caps Gain Steam - SGX, Semb Corp]

Biosensors Gaining Steam

1. Biosensors (Medical equipment)

Biosensors has been posting very steady results for the past 3 years but had fallen out of favour with the investment community in 2012 when its share prices took a tumble to a 2011 low at $1.08. Sell-side research houses still kept their strong rating calls on the stock despite the broader market failing to heed them. Nonetheless, in the start of 2013, Biosensors seem to have gained steam again and could possibly spark the revival of its fortunes to finally match its historical performance and a barometer of the future to come.

• Large white candlestick this week with almost twice the moving average's volume. Prices almost rallied $0.10, representing a 7% gain. The white candlestick has also overcome key moving averages.
• MACD - is trending into the positive region with increased positive divergence.
• RSI (25w) - heading towards 70% levels while just crossing 50%.
• Long with TP - $1.56 (19% from current levels) expected in 6-7 weeks. If buying pressure still persists in the coming week, expect the stock to breakout to the next level above $1.36. With current bullish indications with room for the stock price to come, it will not come as a surprise if stock price ignores $1.36 and heads for $1.55 region. However, do be warned that the coming week is critical for confidence in the stock breaking through a key resistance level at $1.36.

Large Caps Gain Steam - SGX, Semb Corp

[Previous post: Mixed Fortunes of Oil & Gas - Ezra, Swissco]

Large Caps Gain Steam

1. SGX (financial services)
SGX 2Q profit grew to $76 million on the back of increased daily average traded volume. This 16.7% increase in quarter profit reflects the resilience and rebound of Singapore's key market place and the work SGX has been putting into attracting more securities and derivatives trades.

• Price broke out last week above $7.20. Even stronger buying pressure ensued in the first half of this week with yet another big white candlestick with an open at the same levels as last week's close. Very bullish situation.
• MACD - is trending upwards is increased positive divergence.
• RSI (25w) - heading towards 70% levels with some leeway to go before overbought status.
• Long with TP - $$7.80 (-2% from current levels) in the near term (1-2weeks). If buying pressure still persists, expect the stock to breakout to the next support level at $8.60 which translates to almost a 10% gain from Wednesday close price. Prepare to provide 6-8 weeks for $7.80 resistance to be broken as that is roughly the same time period between May to Aug 2011 where the stock tumbled through the price region.

2. SembCorp (Oil & Gas; Utilities; Env Management)

• Prices appear steadily appreciating towards $5.70. In a stealth rally, Semb Corp has almost risen $0.60 since Nov 2012. Volumes are still thin but that is the surprise of the move since 2 months ago. Large white bullish candlestick currently formed this week.
• MACD - MACD crossed into the positive territory this week. Positive divergence showing good pace.
• RSI (25w) -RSI climbing steadily but slowly and managed to ease past 50% already.
• Long with TP - $$5.70 (~5% from current levels) over 2-3 weeks. No reason for prices to remain resisted at current levels. Expect trend to continue upwards in the absence of company/industry news.