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Rights issue for Fraser Centerpoint Trust
13 Oct 2020 (109 views)

Dear Mr. Tan
I want you view about the rights issue. Should I take it up?

Reply
The rights issue allows the shareholders to buy 290 units for every 1,000 units at an issue price of $2.34 per unit.

The current price of this trust is $2.37. So, the rights price is not attractive. 

When the rights issue was approved earlier, the price of the trust was higher. It has since dropped to the rights issue price. 

Is Fraser Centerpoint Trust attractive at the current price of $2.37?

It has a PE ratio of 11.39 times and a forward divident yield of 5.11%. The price to book is 1.30 times.

At this price, the share is acceptable, but it is not really attractive. I prefer to invest in other property stock that gives an attractive discount to the asset price. For example, an investor can buy Hong Kong Land (which has a large portfolio of Singapore property) at a discount of 70% to asset value.





 


Rights issue for Fraser Centerpoint Trust
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Dear Mr. Tan
I want you view about the rights issue. Should I take it up?

Reply
The rights issue allows the shareholders to buy 290 units for every 1,000 units at an issue price of $2.34 per unit.

The current price of this trust is $2.37. So, the rights price is not attractive. 

When the rights issue was approved earlier, the price of the trust was higher. It has since dropped to the rights issue price. 

Is Fraser Centerpoint Trust attractive at the current price of $2.37?

It has a PE ratio of 11.39 times and a forward divident yield of 5.11%. The price to book is 1.30 times.

At this price, the share is acceptable, but it is not really attractive. I prefer to invest in other property stock that gives an attractive discount to the asset price. For example, an investor can buy Hong Kong Land (which has a large portfolio of Singapore property) at a discount of 70% to asset value.