SGX Real Estate Index Priced Below Book Value with Yields Near 6%
OREANDA-NEWS. Introduced this month, the SGX Real Estate Index is a free-float, market capitalisation weighted index that measures the performance of the listed real estate sector in Singapore. Constituents in the index include real estate developers, real estate operators and real estate investment trusts. As of yesterday’s close, the 54 stocks were trading at average price-earnings (P/E) and price-to-book (P/B) ratios of 12.8 and 0.8 respectively, while maintaining a dividend yield of 5.9%.
Book value is made up of the stock’s tangible assets net of liabilities (such as debt), and expressed as a function of the shares outstanding. The price-to-book (P/B) ratio is used to compare a stock's market value to its book value. It is calculated by dividing the current closing price of the stock by the latest quarter's book value per share. The ratio is a common gauge used by investors to determine whether a firm may be undervalued or overvalued. The frequency of net asset valuations, additional capital raisings and unit prices are predominant drivers of the P/B ratio. As noted in the My Gateway Highlight, by comparison, the STI trades at a P/B ratio of 1.1.
Weightings of the SGX Real Estate Index components are capped at a maximum 10% at each semi-annual rebalance, so that it is better diversified across a range of stocks. Currently, the five largest stocks by index weight are CapitaLand, Hongkong Land Holdings, Global Logistic Properties, Ascendas REIT and CapitaLand Mall Trust. Combined, these five companies make up almost 50% of the Index. Liquidity is also reviewed semi-annually, and is measured as a percentage of a company’s Daily Traded Value with respect to its Free-Float Market Capitalisation.
The five best performers of the Index in the year thus far are Debao Property Development, IPC Corporation, Weiye Holdings, Ascendas India Trust and Mapletree Industrial Trust. These five averaged a year-to-date return of 79.4%, with the median return at 17.6%.
The 54 constituents of the SGX Real Estate Index are tabled below, and are sorted according to index weight. Clicking on a stock name will take you to its relevant page on StockFacts.
Name | SGX Code | Market Cap in S$mln | Total Return YTD % | Total Return: 3 Yrs % | Dvd Yld % | GICS® Sub Industry Name |
CapitaLand | C31 | 13,891 | 1.3 | -4.3 | 2.8 | Diversified Real Estate Activities |
Hongkong Land Holdings | H78 | 16,517* | 6.5 | 8.2 | 2.7 | Real Estate Operating Companies |
Global Logistic Properties | MC0 | 9,810 | -14.4 | -20.5 | 2.7 | Real Estate Operating Companies |
Ascendas REIT | A17U | 5,640 | 1.9 | 17.0 | 6.8 | Industrial REITs |
CapitaLand Mall Trust | C38U | 6,799 | -0.8 | 4.9 | 6.2 | Retail REITs |
Suntec REIT | T82U | 3,883 | -16.9 | 10.1 | 6.6 | Diversified REITs |
City Developments | C09 | 6,956 | -24.3 | -37.8 | 1.0 | Diversified Real Estate Activities |
UOL Group | U14 | 4,857 | -10.7 | 11.0 | 2.5 | Diversified Real Estate Activities |
CapitaLand Commercial Trust | C61U | 3,927 | -20.1 | -6.5 | 6.5 | Office REITs |
Mapletree Industrial Trust | ME8U | 2,740 | 10.8 | 41.6 | 7.3 | Industrial REITs |
Keppel REIT | K71U | 3,007 | -19.6 | -13.1 | 7.3 | Office REITs |
Mapletree Greater China Commercial Trust | RW0U | 2,501 | 2.5 | N/A | 7.7 | Diversified REITs |
Mapletree Commercial Trust | N2IU | 2,715 | -4.1 | 24.1 | 6.3 | Retail REITs |
Mapletree Logistics Trust | M44U | 2,471 | -10.4 | 7.6 | 7.4 | Industrial REITs |
Ascott Residence Trust | A68U | 1,789 | -3.2 | 9.1 | 7.0 | Residential REITs |
Starhill Global REIT | P40U | 1,625 | -0.9 | 16.6 | 7.1 | Retail REITs |
Frasers Centrepoint Trust | J69U | 1,674 | 1.9 | 10.9 | 6.3 | Retail REITs |
CapitaLand Retail China Trust | AU8U | 1,240 | -3.1 | 5.7 | 7.3 | Retail REITs |
CDL Hospitality Trusts | J85 | 1,283 | -20.4 | -16.9 | 8.0 | Hotel & Resort REITs |
Frasers Commercial Trust | ND8U | 999 | -4.1 | 21.9 | 7.6 | Office REITs |
Wing Tai Holdings | W05 | 1,366 | 8.9 | 4.9 | 1.7 | Real Estate Development |
Parkway Life REIT | C2PU | 1,367 | 0.2 | 20.9 | 6.0 | Health Care REITs |
AIMS AMP Capital Industrial REIT | O5RU | 879 | 5.8 | 21.3 | 8.1 | Industrial REITs |
Ascendas India Trust | CY6U | 814 | 13.6 | 37.3 | 6.0 | Real Estate Operating Companies |
SPH REIT | SK6U | 2,394 | -4.2 | N/A | 5.9 | Retail REITs |
Cache Logistics Trust | K2LU | 803 | -15.5 | -7.6 | 9.5 | Industrial REITs |
First REIT | AW9U | 885 | -0.2 | 36.3 | 7.1 | Health Care REITs |
Lippo Malls Indonesia Retail Trust | D5IU | 867 | -2.1 | -17.7 | 9.9 | Retail REITs |
OUE Hospitality Trust | SK7 | 988 | -11.8 | N/A | 9.3 | Hotel & Resort REITs |
Cambridge Industrial Trust | J91U | 740 | -9.8 | 5.7 | 8.4 | Industrial REITs |
Far East Hospitality Trust | Q5T | 1,145 | -16.2 | -22.5 | 7.5 | Hotel & Resort REITs |
Yoma Strategic Holdings | Z59 | 772 | -24.3 | -28.7 | N/A | Real Estate Development |
Soilbuild Business Space REIT | SV3U | 696 | 2.0 | N/A | 8.7 | Diversified REITs |
Yanlord Land Group | Z25 | 1,968 | -1.8 | -29.1 | 1.3 | Real Estate Development |
Croesus Retail Trust | S6NU | 522 | -0.1 | N/A | 7.5 | Real Estate Operating Companies |
Sabana Shari'ah Compliant Industrial REIT | M1GU | 527 | -16.7 | -18.5 | 9.8 | Industrial REITs |
Frasers Hospitality Trust | ACV | 1,005 | -9.8 | N/A | 8.2 | Hotel & Resort REITs |
Ho Bee Land | H13 | 1,332 | 4.9 | 13.2 | 2.5 | Real Estate Development |
China Merchants Holdings (Pacific) | C22 | 1,588 | 2.2 | 53.8 | 7.7 | Highways & Railtracks |
OUE Commercial REIT | TS0U | 842 | -3.9 | N/A | 6.0 | Office REITs |
Hong Fok Corporation | H30 | 574 | -10.2 | 34.9 | 1.4 | Real Estate Development |
Ying Li International Real Estate | 5DM | 394 | -37.1 | -57.2 | N/A | Diversified Real Estate Activities |
China New Town Development Company | D4N | 542 | 3.8 | 10.0 | N/A | Real Estate Development |
Tuan Sing Holdings | T24 | 377 | -18.0 | 1.0 | 1.6 | Real Estate Development |
Rowsley | A50 | 785 | -7.7 | 280.9 | N/A | Multi-Sector Holdings |
Viva Industrial Trust | T8B | 602 | -3.7 | N/A | 10.1 | Diversified REITs |
IPC Corporation | AZA | 168 | 39.5 | 57.2 | 1.3 | Real Estate Development |
Centurion Corporation | OU8 | 289 | -21.4 | 114.1 | 1.3 | Hotels, Resorts & Cruise Lines |
IREIT Global | UD1U | 420 | -5.2 | N/A | 3.2 | Office REITs |
SingHaiyi Group | 5H0 | 272 | -33.3 | -16.1 | N/A | Real Estate Development |
HLH Group | H27 | 36 | -30.8 | -65.4 | N/A | Agricultural Products |
Weiye Holdings | BMA | 78 | 17.6 | -28.2 | N/A | Real Estate Development |
Debao Property Development | K2M | 53 | 315.4 | -39.2 | N/A | Real Estate Development |
LHN | 41O | 47 | N/A | N/A | N/A | Real Estate Operating Companies |
Average | 0.0 | 10.2 | 5.9 |
Source: SGX, Bloomberg & SGX StockFacts (data as of 22 December 2015)
Note: LHN Limited has experienced irregular trading activity in the year-to-date
*Note: HongKong Land’s market cap is in USD
Alongside the SGX Real Estate Index, SGX also recently introduced the SGX S-REIT 20 Index. The SGX S-REIT 20 Index measures the performance of the largest and most tradable real estate investment trusts listed in Singapore. Singapore’s REIT Sector comprises 35 trusts, whose assets include shopping malls, office towers, industrial parks, hospitality-related assets and healthcare-related assets.
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