哈希定位胆源码出售（www.hx198.vip）:Pavilion REIT's recovery to continue in 2H
KUALA LUMPUR: Pavilion Real Estate Investment Trust (REIT) is expected to continue to benefit from rising footfall as its latest earnings revealed a recovery due to the improving economy and elevated retail sales from the Aidil Fitri festivities.
For 2QFY22, Pavilion REIT reported core profit of RM55mil, which brough 1H22 earnings to RM120mil.
"We think the recovery is well underway, with revenue and core profit similar to pre-pandemic levels, at95% and 94% of 2Q19 numbers," said RHB Research in a note.
The research firm said the REIT's 2Q earning were in line with consensus despite being a seasonally slower quarter due to the Aidil Fitri holidays and higher spending power from the Employees Provident Fund savings withdrawals.
"While still below pre-pandemic levels, footfall in Pavilion Kuala Lumpur should continue to improve withtourists slowly returning since the opening of international borders.
"We expect reversions to be c.3-5% in FY22F on the back of the improved retail outlook," it said.
Pavilion REIT reported the occupancy rate for Pavilion Kuala Lumpur was marginally lower from 90.6% to 89.7% in June, although management guided that the drop would be temporary with tenants being repositioned in the mall.
It added that reversions in 1H22 were positive at 2% to 3% and the REIT is targeting about 92% occupancy in 2H22.,
Meanwhile, the REIT has announced that discussions to purchase Pavilion Bukit Jalil are ongoing, although there was no timeline for the acquisition given.
In Vietnam, the REIT's Da Men Mall posted a net property loss of RM2.91mil in 2Q, but management is hopeful it will return to the black as next year with returning footfall.
RHB maintained its "buy" call on Pavilion REIT with a slightly lower target price of RM1.50.
Meanwhile, Hong Leong Investment Bank (HLIB) Research noted that management plans to cease rental rebates moving into 2HFY22, barring unforeseen circumstances.
It also expects the reopening of international borders to elevate the overall retail footfall especially for crown jewel Pavilion Kuala Lumpur, where international tourists traditionally account for 30% of shopper mix.
"These coupled with the robust tenancy pipeline across its retail properties, 2HFY22 performance is expected to remain resilient," said the research firm.
On its recommendation, it reiterated "hold" with an unchanged target price of RM1.34