Wednesday, March 18, 2015

SGX Singapore News Update : Epic Research Singapore

Business Trusts average 5% YTD total return

The 11 Business Trusts have a combined market capitalisation of S$14.8 billion and have averaged a 5.4% YTD total return, taking into account dividend distributions.

The average dividend yield of 6.3% of the 11 Business Trusts is more than twice the yield of the Singapore Fixed Income Index (SFI) at 2.9%.
The five best performing Business Trusts in the year thus far were First Ship Lease Trust, Ascendas India Trust, Asian Pay Television Trust, Keppel Infrastructure Trust, and Religare Health Trust.
The average YTD total return of the Business Trusts is almost double that of the REIT Sector at 2.8%. The combined market cap of the 11 Business Trusts is just over one-fifth that of the REIT Sector.

As maintained by the Monetary Authority of Singapore (MAS), a Business Trust is a trust that runs and operates a business enterprise. Registered business trusts must have a trustee-manager whose role is to safeguard the interests of beneficiaries (referred to as ‘unitholders’ under the Business Trusts Act) of the trust and to manage the business of the trust.

Business Trusts offer investors a way to invest in cash-generating assets, including infrastructure, real estate and transportation assets. The 11 Business Trusts listed on the Singapore Exchange (SGX) have a combined market capitalisation of S$14.8 billion and they averaged 3.9% price gain in the year-to-date, with dividends boosting its total return to 5.4%. The average dividend yield of 6.3% is more than twice the yield of the Singapore Fixed Income Index (SFI) at 2.9%. The SFI Corporate Bond Index however maintains a higher yield at 3.4%. This is based on data from Thomson Reuters DataStream.

The 11 Business Trusts are made up of four Property Trusts, four Infrastructure Trusts, two Shipping Trusts and a Specialty Trust. The Property Trusts are Ascendas India Trust, Indiabulls Trust, Religare Health Trust and Croesus Retail Trust. The Infrastructure Trusts consists of four trusts as well, and they are CitySpring Infrastructure Trust, Keppel Infrastructure Trust, Hutchison Port Trusts and Asian Pay TV Trust. As for Shipping Trusts, there are Rickmers Maritime and First Ship Lease Trust. And finally, the only specialty trust is Accordia Golf Trust.

The five best performing Business Trusts in terms of total return year-to-date were First Ship Lease Trust (+24.5%), Ascendas India Trust (+10.4%), Asian Pay Television Trust (+8.1%), Keppel Infrastructure Trust (+5.9%), and Religare Health Trust (+5.5%). These five Business Trusts invest in India healthcare and real estate sectors, and Asian energy infrastructure/shipping sectors.

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