Reuters: Hot Stocks: STOCKS NEWS SINGAPORE-Brokers say tax savings to benefit two REITs

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STOCKS NEWS SINGAPORE-Brokers say tax savings to benefit two REITs Jun 19th 2012, 03:56 Mon Jun 18, 2012 11:56pm EDT Brokers including DBS Vickers raised their price targets on Suntec Real Estate Investment Trust and K-REIT Asia after a restructuring that will result in tax savings for both property trusts. Both trusts said last week the company that holds assets in the Marina Bay Financial Centre (MBFC) in Singapore had been converted to a limited liability partnership. Income from the properties will not be subject to corporate tax as a result of the new structure, they said. Suntec and K-REIT each owns a one-third stake in BFC Development LLP, which holds two office towers and an underground retail mall at MBFC. On Tuesday, Suntec units were up 0.4 percent at S$1.33, while K-REIT was flat at S$1.01. So far this year, Suntec has gained nearly 24 percent while K-REIT has advanced almost 22 percent. OCBC Investment Research said Suntec's distribution per unit (DPU) for 2012-2013 fiscal years may get a boost of 0.11 to 0.17 Singapore cents, which translates to a rise of 1.2 to 1.9 percent. It raised its target on Suntec REIT to S$1.23 from S$1.20, but held its hold rating. "This is positive for unitholders as the distributable income is likely to be higher now that the income generated will no longer be subject to corporate tax," OCBC said. DBS Vickers expects K-REIT and Suntec to reap tax savings of close to S$2.2 million ($1.7 million) in 2012 fiscal year and S$4.5 million in 2013, resulting in a DPU increase of 1-2 percent in 2012 and 4-5 percent in 2013. It upgraded K-REIT Asia to buy from hold and raised its price target to S$1.21 from S$1.12. It also raised the target on Suntec REIT by 8.6 percent to S$1.58 and maintained its buy rating. For a related story, click 1109 (0309 GMT) (Reporting by Eveline Danubrata in Singapore; eveline.danubrata@thomsonreuters.com) ************************************************************ 10:49 STOCKS NEWS SINGAPORE-Aussion at 3-year high on Myanmar move Shares of Aussino Group Ltd surged more than one third and extended the previous day's gains after the bed linen company unveiled plans to enter the petrol kiosk business in Myanmar through an acquisition. Aussino was among the top 10 traded stocks with more than 6.7 million shares traded, 4.2 times the average full-day volume traded over the past 30 days. The thinly-traded stock has seen its volume shoot up over the past month. Aussino shares rose as much as 38.5 percent to S$0.144, the highest since May 2009, while the FT ST Fledgling index edged up 0.2 percent. The stock has more than tripled so far this year. Shares of Myanmar-focused firms including property developer Yoma Strategic Holdings Ltd and petroleum firm Interra Resources Ltd have jumped this year as investors seek to benefit from the political opening of the Southeast Asian country. "Myanmar plays have been the flavour of the year," said Bernard Chin, an analyst at Maybank Kim Eng. But he advised investors to be cautious as there were still legal and political risks to investing in Myanmar. Aussino said on Monday it plans to acquire Max Strategic Investments Pte Ltd for S$60 million ($47 million) and the purchase offered growth potential in an emerging market. For a related story, click 1017 (0217 GMT) (Reporting by Eveline Danubrata in Singapore; eveline.danubrata@thomsonreuters.com) ($1 = 1.2723 Singapore dollars) Link this Share this Digg this Email Reprints

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