Indiabulls Properties Investment Trust IPO Review

In layman perspective
- very bold ambition to push through the business trust in this timing
- two previous listing have been withdrawn: Altitude Aircraft Leasing Trust and Arcapital Utility Trust.
- Give exposure to India’s Mumbai property market
- Various forecast given for DPU based on different assumption.
- In worst forecast, DPU for 2009 can be lower then 3%, but if all engines fired, 5.1%
- For 2010 (if you really keep that long), they forecast growth of DPU slightly above 90%. Impressive!

Can this trust give more value then others business trusts in SGX?

My intuitive answer is NO.

OCBC preferential share give 5.1% yield with capital guarantee. Well, I know technically it is not, but, you think OCBC can go belly up?

Step 1, look at the yield from real estate sector – REIT. The average yield is 6.82% now (according data from http://reitdata.blogspot.com/ ). The Bull face pale.

REIT Period DPU ct Price Yield
LMIR Q1 : Mar-08 2.20* S$0.55 10.982%
First REIT Q1 : Mar-08 1.85 S$0.735 10.204%
MI-REIT Q4 : Mar-08 2.22 S$0.96 9.302%
Cambridge Q1 : Mar-08 1.588 S$0.72 8.871%
AllCo Q1 : Mar-08 1.6 S$0.855 7.509%
MapleTree Q1 : Mar-08 1.9 S$0.98 7.755%
AscottREIT Q1 : Mar-08 2.33 S$1.19 7.832%
Saizen FY08 - IPO 5.3 S$0.75 7.067%
Fortune Q1 : Mar-08 8.79 HK$4.91 7.161%
Suntec Q2: Mar-08 2.5185 S$1.64 6.176%
A-REIT Q4 : Mar-08 3.69 S$2.49 5.928%
MMP Q1 : Mar-08 1.76 S$1.17 6.051%
CDL HTrust Q1 : Mar-08 2.86 S$1.96 5.867%
FrasersCT Q2 : Mar-08 1.75 S$1.35 5.185%
PLife Q3 : Mar-08 1.62 S$1.21 5.364%
K-REIT FY08 - Rights 7.53 S$1.45 5.193%
CCT Q1 : Mar-08 2.59 S$2.27 4.590%
CapitaRChina Q1 : Mar-08 1.02* S$1.54 4.325%
CMT Q1 : Mar-08 3.48 S$3.32 4.217%
http://reitdata.blogspot.com/

Step 2, compare with shipping trust. Wow, average yield of shipping trusts is 10.59%. The Bull face pale again.

Shipping Trusts
Trust Period DPU ct Price Yield
FSL Trust Q1 : Mar-08 2.59 S$1.17 12.070%
Rickmers Q1 : Mar-08 2.14 S$1.13 10.326%
PacShipTr US$ Q1 : Mar-08 0.97 $0.41 9.463%
http://reitdata.blogspot.com/

Step 3, compare with business trust. Emm, no one covering Babcock & Brown Global?

Well, the dividend guidance of 5.20 Singapore cents per share for the first half of 2008 worked out to be 16% annualized yield (assume 5.2 cent x 2 / 64 cent current market price). The Bull, once again, pale.

Think it is not too hard for me to a make decision.

Cheers!