Mapletree Industrial soars on debut; attractive yield: NRA

Mapletree Industrial Trust (ME8U.SG) opens +23.7% at $1.15, vs $0.93 IPO price; last at S$1.17; MIT second Singapore sovereign wealth fund-backed entity to come to market this week, after GLP (MC0.SG) listed Monday; MIT offer was 38x subscribed. NRA Capital says IPO price translates to “attractive” annualized yield of 7.6% for FY11, projected FY12 yield at 8.0%. “We also like MIT for its diversified portfolio (70 properties across various types) which offers a level of resilience. We believe that MIT is a strong dividend play stock and would appeal to investors who prefer a stable income-yielding stock.” Tips various rental growth opportunities as portfolio’s average rent generally below market rents, opportunities for rental reversion as rental caps expiring, MIT has well-positioned lease expiry profile. Also likes exposure to industrial market which less volatile vs office market. Order book quotes suggest $1.20 near-term hurdle.

Mapletree Industrial Trust closes at $1.16, 24.7% over IPO price

Mapletree Industrial Trust (MIT), the Singapore-focused real estate investment trust (REIT) and one of the largest landlords of industrial space in Singapore, enjoyed a strong trading debut at 2.00 p.m. today on the Mainboard of Singapore Exchange.

The IPO raised gross proceeds of $1.19 billion from the offering of 594,913,000 units to the public and under the placement tranche, as well as the Mapletree cornerstone subscription units and the cornerstone units (as defined below). MIT’s units opened strongly at $1.15 per unit, a 23.7% increase over its offering price of $0.93 per unit (Offering Price). The units reached an all-day high of $1.20 per Unit, a 29.0% jump over its offering price. At the close of trading, the units ended 24.7% higher than its offering price of $0.93 at $1.16 per unit with 345 million units changing hands, making it the most actively traded counter on the SGX today. Commenting on the trading debut, Mr Tham Kuo Wei, Chief Executive Officer of Mapletree Industrial Trust Management Ltd, as manager of MIT, says, “We are delighted with MIT’s excellent trading debut, which is a strong indication of the market’s confidence in the fundamentals and growth prospects of MIT.”

MIT’s IPO 38 times oversubscribed

Trust expected to raise as much as $1.19b in gross proceeds from IPO

Mapletree Industrial Trust’s (MIT) initial public offering (IPO) saw a strong take-up rate with an oversubscription of about 37.9 times, led by demand from institutional players.

The take-up means that more than $20.1 billion in total of application money was made available for the IPO, MIT said yesterday.

MIT is expected to raise as much as $1.19 billion in gross proceeds from its IPO, if an overallotment option of 91.75 million units is exercised.

Mapletree is selling 1.28 billion MIT units at 93 cents apiece. This includes some 595 million units, comprising 489 million units that were placed out and 106 million units that were sold to the public.

Six cornerstone investors, namely AIA, Prudential Asset Management (Singapore), Henderson Global Investors, Columbia Wanger Asset Management, US investment firm DE Shaw and Dutch pension fund APG, will subscribe for a separate 323 million units.

Mapletree’s two subsidiaries, Mapletree Dextra Pte Ltd and Sienna Pte Ltd, will also subscribe for 359 million units, giving Mapletree a post-IPO stake of about 31 per cent if the greenshoe option is fully exercised.

The placement tranche of 489 million units was oversubscribed by 39.6 times, with a total value exceeding $18 billion.

The public tranche included 25.5 million units reserved for subscription by the directors, management, employees and business associates of Mapletree.

The remaining 80.6 million units, representing about 6.3 per cent of the total unit sale (excluding the overallotment), was about 27.7 times oversubscribed, translating to total value of about $2.1 billion.

MIT’s offer price represents an annualised distribution yield of 7.6 per cent for fiscal 2010, which is estimated to rise to 8 per cent for fiscal 2011.

It expects to pay out all of its distribution income to unitholders from listing until March 31, 2012, MIT said at a briefing last week.

MIT, which is the third real estate investment trust to be launched by Temasek Holdings’ Mapletree Investments, has a portfolio of 70 industrial properties in Singapore.

Global Logistic Properties (GLP) also saw firm interest in its IPO, which was more than 12 times oversubscribed.

Out of the 88,393 public offer applications for GLP, 85,136 applications, or 96 per cent, were successful ones.

The balloting results of the GLP applications also threw up some startling numbers. It showed that there were 22 successful applicants from the public who had initially applied for at least one million shares, coughing up at least $1.96 million upfront.

They were eventually allotted 10,000 shares each.

Shares of GLP continued their uptrend yesterday, gaining 5.53 per cent or 12 cents to end at $2.29. It was the most active stock on the Singapore Exchange, with 262 million shares changing hands.

Trading of the units of MIT is expected to start tomorrow at 2pm.