Wednesday, March 16, 2016

Croesus Retail Trust - New Counter In My Watch List

Recently, I've just shared about one stock, Hock Lian Seng, which is under my watch list in view of its potential from the CNAV (Conservative Net Asset Value) Analysis perspective. For more details, you can check it out here. Today, I am going to share another counter which was newly included in my watch list, which is Croesus Retail Trust (S6UI).

Croesus is the first SGX-listed Asia-pacific retail business trust with a portfolio located in Japan and it was listed in Singapore on 10 May 2013 (IPO price : $0.93), which is relatively new. 

Do take note that Croesus is a business trust and not REITS, there are differences between the two, which my friend like to term them "same same but different"! ;-)

Some Key Business Overview of Croesus Retail Trust:

1. Market Cap of $192 mil

2. Substantial shareholders : Target Asset Management and DBS Bank Ltd

3. Consist of a portfolio of 8 malls in Japan (5 in Tokyo), they are:
    a. Aeon Town Moriya
    b. Aeon Town Suzuka
    c. Croesus Shinsaibashi
    d. Croesus Tachikawa
    e. Luz Omori
    f. Mallage Shobu
   g. One's Mall
   h. Torius

4. Occupancy Rate : close to 100%

5. Average 8 years of WALE (Weighted Average Lease Expiring)

6. Gearing Ratio of 46.3% (which is on the high side)

7. Weighted debt maturity of 2.6 years

8. Trailing Annual Dividend Yield of 9.3% with the following dividend distribution history:
Croesus dividend history
Croesus Retail Trust : Dividend Distribution History
Besides the stable performance of the portfolio and lucrative dividend yield, following are some strengths/opportunities that appeal to me:

a.  The recent introduction of negative interest by BOJ could potentially lead to lower debt cost and further increase its asset valuation

b. Appreciating Japanese Yen which increases the NAV in S$

c. Currency hedged over the entire expected distribution for FY16 to FY18 (which serve as a double protection for more stable dividend yield)

d. Upcoming Olympic Tokyo 2020 is expected to boost the tourism and retail businesses there.

Croesus Retail Trust is currently trading at $0.795, which is 1.19 times of book value ($0.67). I am saving this counter in my watch list and will nimble at around the price range of $0.75 to $0.77.


P/S: DYDD (Do Your Due Diligence)


  1. Thanks for sharing. This is useful!:)

    1. DK : Thanks for dropping by and glad that you find it useful.


  2. The price to book value is 0.884 as shown in SGX web site. So the book value is about $0.90.

    1. I am using Yahoo Finance's valuation for the book value. Maybe SGX has the more up-to-date valuation. Thanks for highlighting.


  3. Looking at their latest slides, their NAV/unit is 76.03 yen. If we use 83yen/sgd it's actually about 0.92 sgd.

    1. Owq : you are right! I was using the yahoo finance's valuation which have not taken into consideration of the latest valuation. Thanks for highlighting


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