DJ MARKET TALK: DB Cuts Suntec REIT Target To S$0.73; Keeps Buy
0105 GMT [Dow Jones] STOCK CALL: Deutsche Bank cuts Suntec REIT target price to S$0.73 from S$1.00; maintains Buy rating. Broker says new target price reflects "dilution scenario" based on assumption REIT will issue new equity to help refinance debt maturing this year. But thinks refinancing risks already priced in; "we believe that dilution for an equity raising to refinance S$825 million of debt expiring this year is priced in, and a successful refinancing could lift this overhang." Adds weakening retail sales, declining office rents will affect REIT's portfolio, but this is also already reflected in low valuation with REIT offering 15.7% FY09 yield, deep 69% discount to book net asset value. Shares down 0.8% at S$0.605. (KIG)
(END) Dow Jones Newswires
February 16, 2009 20:05 ET (01:05 GMT)
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