Keppel REIT (K71U) AI Stock Analysis

• Market Cap: $3.38B
• Dividend Yield: 5.9%
• Average Volume (3M): 4.64M
• Price to Earnings (P/E): 33.6
• Beta (1Y): 0.58
• Revenue Growth: 4.19%
• EPS Growth: -42.41%
• Country: SG
• Employees: 25
• Sector: Real Estate
• Sector Strength: 63
• Industry: REIT - Office
• EPS (TTM): N/A
• Shares Outstanding: 3,880,485,400
• 10 Day Avg. Volume: 5,768,954
• 30 Day Avg. Volume: 4,643,644
• PEG Ratio: 0.11
• Price to Book (P/B): 0.62
• Price to Sales (P/S): 0.00
• P/FCF Ratio: 20.89
• Enterprise Value/Market Cap: N/A
• Enterprise Value/Revenue: N/A
• Enterprise Value/Gross Profit: N/A
• Enterprise Value/Ebitda: N/A
• 1Y Price Target: $1.08
• Price Target Upside: 22.54% Upside
• Rating Consensus: Strong Buy
• Number of Analyst Covering: 3

• Rating: 67 Neutral
• Price Target: ―

Keppel REIT's overall score reflects a stable financial performance with strong margins and a solid balance sheet, but concerns over declining revenue and profitability, as well as negative free cash flow growth, need attention. The technical analysis suggests a bearish trend, with the stock trading below key moving averages. The valuation indicates a high P/E ratio, but the attractive dividend yield offers some appeal to investors. No recent earnings call data or corporate events were factored into this analysis.

Positive Factors

Net Property Income

Broad-based growth in Singapore and overseas contributed to a 10.7% year-over-year growth in Net Property Income in 2H24.

Occupancy and Leasing

KREIT renewed or leased approximately 260,000 square feet of space, with demand coming from several key sectors.

Rental Reversion

Positive rental reversion continues, with a 1Q25 rental reversion at +10.6%.

Negative Factors

Interest Costs

1Q25 distribution income was 3.2% lower year-over-year due to higher interest costs and payment of 25% of management fees in cash.

Market Risks

Key risks to the positive view are a prolonged economic downturn and potential second wave of COVID-19, which could impact rents and vacancies.

Occupancy Levels

Occupancy at Ocean Financial Centre (OFC) dipped 3.7ppt qoq to 94.7% due to BNP Paribas returning several floors.

Keppel REIT Business Overview & Revenue Model

Company Description

Listed by way of an introduction on 28 April 2006, Keppel REIT is one of Asia's leading REITs with a portfolio of Grade A commercial assets in key business districts pan-Asia. Keppel REIT's objective is to generate stable income and long-term growth for Unitholders by owning and investing in a portfolio of quality income-producing commercial real estate and real estate-related assets in Singapore and pan-Asia. The REIT has assets under management of over $8 billion in Singapore, key Australian cities of Sydney, Melbourne, Brisbane and Perth, as well as Seoul, South Korea. Keppel REIT is sponsored by Keppel Land Limited, one of Asia's leading property companies. It is managed by Keppel REIT Management Limited, a wholly-owned subsidiary of Keppel Capital Holdings Pte Ltd (Keppel Capital). Keppel Capital is a premier asset manager in Asia with a diversified portfolio in real estate, infrastructure and data centre properties in key global markets.

How the Company Makes Money

Keppel REIT generates revenue primarily through rental income derived from its portfolio of office properties. It leases space to a diverse tenant base, including multinational corporations and financial institutions, ensuring stable and recurring rental income. Additionally, Keppel REIT may engage in strategic property acquisitions and disposals to enhance its portfolio value and generate capital gains. The REIT also benefits from its partnership with Keppel Land and other affiliates, leveraging their expertise in property development and management to optimize asset performance and value. Furthermore, Keppel REIT might engage in financial instruments and hedging strategies to manage interest rate exposure and enhance returns.

Keppel REIT Financial Statement Overview

Summary

Overall, Keppel REIT shows a stable financial position with strong gross and EBITDA margins and a solid balance sheet. However, the decline in revenue and net profit margins, along with negative free cash flow growth, highlight potential areas of concern. The company must focus on reversing revenue declines and maintaining profitability to ensure continued financial health.

Income Statement

The income statement reveals a mixed performance. The gross profit margin and EBITDA margin are strong, indicating efficient cost management. However, the net profit margin has declined from the previous year, signaling possible challenges in profitability. The revenue growth rate is negative, showing a decrease in total revenue year-over-year, which could be concerning for future profitability.

Balance Sheet

The balance sheet is relatively strong, with a solid equity base and a reasonable debt-to-equity ratio, suggesting financial stability. The equity ratio is high, indicating a strong capital structure. However, there has been an increase in total liabilities compared to previous years, which could pose a risk if it continues to rise.

Cash Flow

The cash flow statement is stable, with a positive operating cash flow to net income ratio, indicating good cash generation relative to net income. However, the free cash flow growth rate is negative, reflecting decreased cash flow from operations and capital expenditures. This could impact the company’s ability to finance new investments or return capital to shareholders.

Breakdown
Dec 2024	Dec 2023	Dec 2022	Dec 2021	Dec 2020
Income Statement		Total Revenue
282.89M	336.86M	219.29M	216.61M	170.22M
	Gross Profit
158.18M	286.17M	175.94M	172.53M	135.48M
	EBIT
0.00	223.79M	496.90M	330.91M	44.74M
	EBITDA
217.70M	273.04M	496.93M	330.93M	44.75M
	Net Income Common Stockholders
108.44M	178.03M	414.84M	241.17M	279.00K
Balance Sheet		Cash, Cash Equivalents and Short-Term Investments
83.87M	141.58M	174.96M	178.68M	146.02M
	Total Assets
8.46B	8.26B	8.88B	8.49B	7.76B
	Total Debt
2.66B	2.34B	2.85B	2.73B	2.38B
	Net Debt
2.58B	2.21B	2.68B	2.55B	2.23B
	Total Liabilities
2.82B	2.51B	3.02B	2.90B	2.54B
	Stockholders Equity
5.19B	5.00B	5.42B	5.17B	4.80B
Cash Flow		Free Cash Flow
188.98M	200.51M	162.22M	108.55M	93.73M
	Operating Cash Flow
188.99M	208.06M	162.23M	113.67M	104.46M
	Investing Cash Flow
-250.92M	492.82M	-46.38M	-383.13M	-219.88M
	Financing Cash Flow
2.15M	-742.27M	-111.42M	303.35M	140.88M

Keppel REIT Technical Analysis

• Technical Analysis Sentiment: Positive
• Last Price: 0.88
• 50DMA: Positive
• 100DMA: Positive
• 200DMA: Positive
• MACD: Negative
• RSI: Negative
• STOCH: Negative

Evaluating momentum and price trends is crucial in stock analysis to make informed investment decisions. For SG:K71U, the sentiment is Positive. The current price of 0.88 is above the 20-day moving average (MA) of 0.86, above the 50-day MA of 0.85, and above the 200-day MA of 0.85, indicating a bullish trend. The MACD of <0.01 indicates Negative momentum. The RSI at 70.08 is Negative, neither overbought nor oversold. The STOCH value of 86.67 is Negative, not indicating any strong overbought or oversold conditions. Overall, these indicators collectively point to a Positive sentiment for SG:K71U.

Keppel REIT Peers Comparison

Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
K71U	67 Neutral	$3.38B	33.59	2.02%	5.90%	4.19%	-42.41%
Sector *	61 Neutral	$2.86B	10.96	0.41%	6.08%	5.73%	-21.25%
ACDSF		$9.22B	16.11	7.61%	5.50%	―	―
MAPIF		$4.31B	16.65	6.85%	6.83%	―	―
PRKWF		$2.06B	27.16	6.39%	2.23%	―	―
SURVF		$2.59B	30.53	1.86%	5.49%	―	―
TS0U	55 Neutral	S$1.57B	8.06	-1.97%	7.93%	-1.51%	-135.46%

Keppel REIT Corporate Events

Keppel REIT Issues Units for Management Fee Payment

Keppel REIT Management Limited has announced the issuance of 9,890,735 units at S$0.8572 per unit as part of the management fee payment for the period from January to March 2025. This issuance increases the company’s holdings to 196,484,713 units, representing 5.06% of the total issued units in Keppel REIT, reflecting the company’s strategic decision to receive a portion of its fees in units to strengthen its position in the trust.

Keppel REIT Secures S$150 Million Green Loan Facility

Keppel REIT has secured a S$150 million Green Loan Facility, guaranteed by HSBC Institutional Trust Services, to support its operations. A condition of the loan requires immediate repayment if there is a change in management not involving a wholly-owned subsidiary of Keppel Ltd., potentially impacting facilities worth approximately S$2.671 billion if triggered.

Keppel REIT Releases Q1 2025 Business Updates

Keppel REIT, managed by Keppel REIT Management Limited, has released its key business and operational updates for the first quarter of 2025. The announcement provides insights into the company’s performance and strategic direction, which are crucial for stakeholders to understand its market positioning and future prospects.

Keppel REIT Increases Stake with Management Fee Units Issuance

Keppel REIT Management Limited announced the issuance of 26,548,914 units at S$0.8507 per unit as payment for its management fees, thereby increasing its holdings to approximately 4.83% of the total issued units. This strategic move aligns with Keppel REIT’s trust deed, allowing the company to receive its management fees entirely in units, reinforcing its commitment to stakeholder value and its positioning in the REIT market.