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In my previous note, China Merchants Commercial REIT Pre-IPO - Not a Very Steady past Performance, I looked at the past performance of the company and analysed its asset portfolio. In this note, I talk about the updates since my previous note, deal dynamics, what the forecast implies and run the deal through our ECM framework.
CMCREIT’s sponsor has provided a minimum DPU commitment all the way till FY22. However, our back of the envelope calculation seems to suggest that CMCREIT’s DPU is likely to fall short of the sponsor’s commitment level for FY22. Furthermore, by FY22 it might not even reach the FY19 commitment level.
China Merchants Commercial REIT IPO - Yield will fall short once the commitment is over
China Merchants Commercial REIT (CMCREIT) plans to raise up to US$383m in its Hong Kong IPO. The REIT will own five mature office and retail assets located in Shenzhen.In my previous note, China Merchants Commercial REIT Pre-IPO - Not a Very Steady past Performance, I looked at the past performance of the company and analysed its asset portfolio. In this note, I talk about the updates since my previous note, deal dynamics, what the forecast implies and run the deal through our ECM framework.
CMCREIT’s sponsor has provided a minimum DPU commitment all the way till FY22. However, our back of the envelope calculation seems to suggest that CMCREIT’s DPU is likely to fall short of the sponsor’s commitment level for FY22. Furthermore, by FY22 it might not even reach the FY19 commitment level.
Provider
Aequitas Research
Aequitas Research is a leading ECM research firm with a focus on IPOs and placements/follow-on offerings across the Asia Pacific with deal size of over USD100m.
Since 2015, we have covered 400+ IPOs and 450+ placements with a hit rate of 73% and 65%, respectively. We combine fundamental bottom-up views with our proprietary quantitative framework to provide a holistic analysis.
Our coverage includes pre-IPO notes before the deal is launched, follow-up analysis once the deal is live and post-listing trading analysis. We also provide a more quant driven analysis on placement/follow-on offerings.
Markets that we cover include:
Hong Kong,
China ADRs,
India,
Japan,
Australia, and
ASEAN.
Hong Kong,
China ADRs,
India,
Japan,
Australia, and
ASEAN.
Sumeet Singh
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