Wednesday, 23 October 2013

Keppel Reit Dumped by Temasek, Should You?

On yesterday (22 Oct) morning, Keppel Reit price dropped 4%( or 5 cents) with elevated transaction volume. (To note: Its year-to-date DPU is about 7.5 cents, which means one day the price almost dropped as much as 3Q's DPU)).
I doubted it might be dumped by some large shareholder (perhaps some investment fund) who was migrating money out of S-REITs.  It turned out to be true. It was dumped by Temasek. ( look at the high volume bar!).



Today the counter is closed at 1.195 or 5% discount to its NAV of 1.25. This happened despite that K-Reits had just released a decent last Q result. The office rental is also reverting upwards.



According to K-Reits latest Q report, its prospects are stable, and the refinancing won't happen until 2 years later. But Temasek obviously preferred to exchange KReit in hand now for cash. Worth noting that Temasek did similar before last year, to Singtel, whose price was initially depressed but then gradually recovered. Maybe large holders sold their holdings not because the stock itself is going bad, but for other good reasons.
 
From BT: Temasek sells KReit stake for S$125m. According to sources close to the deal, Temasek Holdings has sold its entire directstake in office landlord Keppel Reit (KREIT) in a share placement. The deal involved 103,994,321 shares offered at a price range of between S$1.195 and S$1.21 per share. The placement offer amounted to an estimated S$125m. Temasek's share sale works out to 3.74% of KREIT,representing the stake it had received from the dividend in specie distributed by Keppel Corp to its shareholders during its FY2012 final results announced on 24 Jan 13.

1 comment:

  1. It is normal for Temasek or GIC to do portfolio re-balancing from time to time. No fundamental issue with keppel reit. I am doing portfolio re-balancing on weekly basis. Frequency and magnitude of portfolio re-balancing are different for every individuals.

    ReplyDelete

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