Apr 26, 2021

Cory Diary : Frasers Cpt 1H2021

FCT has solid properties mainly in key locations next to MRT. Their returns grow with the Singapore economy and the mass population reside near to their malls.  The remarkable ones are Northpoint north wing and Waterway point which have Condo residences above their malls in Integrated concept to transport hub and community services. See below. Basically community revolves around this malls. They are basic necessity and which benefits further from WFH. Both malls are huge and for new comers therefore getting lost in there is normal.


In last week half year report, 1st half DPU 5.996 cents. In which 0.132 cents already distributed last year. If we annualized the result, is about 4.9% at $2.45.


If we roll back to year 2019, FCT hits 5.7% annualized at today price. DPU 14 cents. This is pre-covid. Logically speaking 2nd half will also see better result unless macro factor or .... . So it looks like a given in next half yearly amid expectation will be smaller increase.

Interestingly, the stock price did not manage to held up and fall back to $2.45 last week. We are talking about 28.4% dpu increase compared to last year where retail was in deep covid. Now with Vaccine deploying to masses and we getting to new normal, is not unreasonable to see stable 5% yield returns. That's like 12.5 cents of DPU annual. So if the market further corrects to $2.33 roughly a support point, that's will almost be a full year dpu. This will certainly make it easier to meet pre-covid yield LOL.

Question will be what will you do as a dividend player on a well established businesses ? Uncle Cory will have his grenades ready. Bazooka will probably be next.


Cory
2021-0426

PS. Current Bank loan rate is roughly 1.5%. FCT giving out stable 5%. Make sense to max out your home loan ?  There is always risk so DYODD.

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