Suntec REIT (SUNT.SI): Singapore Portfolio Exhibits Operational Strength

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Suntec REIT (SUNT.SI): Singapore Portfolio Exhibits Operational Strength

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23 Jul 2026 10:41:50 ET │ 12 pages

Suntec REIT (SUNT.SI)

Singapore Portfolio Exhibits Operational Strength

CITI'S TAKE

Sell Suntec REIT's (SUN) 1H26 strong results (beat) primarily stemmed from

robust operating performance in retail and office portfolio in Singapore Price (23 Jul 26 17:06) S$1.51

(collective 71% of NPI), as well as lower debt expenses and absence of AU Target price S$1.22

withholding tax provision, but again mitigated by Australia. Nonetheless, Expected share price return -19.2%

SUN's FY26E reversion guidance suggests to us 2H26E could slow HoH, Expected dividend yield 4.9%

particularly on office front. SUN (+5%) has outperformed S-REITs (-4%) Expected total return -14.3%

YTD, which we attribute to market expectations of positive outcome from

Market Cap S$4,467M potential strategic review (particularly following the recent appointment

US$3,460M of a new Non-Executive Director and Chairman, as SUN mentioned during

its 1Q26 results briefing that the strategic review hasn't happened then as

it's still in the process of nominating new Board members (link), but given

stretched valuations (4.9/5.0% FY26E/27E yields) and high gearing Brandon LeeAC

(43/45.3% excluding/including perps), we maintain Sell rating. We see +65-6657-1118

positive read-through to CICT's and KREIT's Singapore office performance brandon2.lee@citi.com

during their upcoming 2Q26E results.

Singapore drove 1H26 — 1H26 DPU surged 25% YoY (+1% HoH) to 3.94 Scts

(54/52% of our/consensus' FY26E; beat), driven by stronger operating performance

from Singapore Office and Singapore Retail, as well as lower debt expenses (-12%)

and absence of additional AU withholding tax provision. We estimate NPI including