Filinvest REIT (FILRT) IPO Special Report: Undervalued or Overvalued?

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SUMMARY OF RECOMMENDATION

Filinvest REIT (FILRT) is looking to raise as much as PHP 14.9 Billion from the REIT offering at a price of PHP 8.30/share. FILRT will sell 1.63 Billion shares, with an overallotment option of 163 Million shares. All proceeds will be used by FILRT in accordance with its reinvestment plan.

At an indicative offer price of PHP 8.30/share, this is equivalent to 5.3 to 5.9% based on 2021 earnings and 5.6-6.2% based on 2022 earnings. This will be at par with the median average dividend yield for the region of 5.5% and 5.7% for 2021 and 2022, respectively.

 

OUR PARTNER BROKER’S ANALYSIS

Company Overview

Filinvest Land, Inc. is one of the leading property developers with a 244-ha land in Filinvest City in Muntinlupa City, with 86-ha of remaining saleable land. It is the largest contiguous Metro Manila CBD property controlled by a single group. Among landmark projects include the 52-storey PBCom Tower, 201-ha Mimosa Leisure City, and the 244-ha Filinvest City. FLI’s office GLA has grown 16.7% CAGR to 524,000 sqm, and expected to expand further to 750,000sqm by 2022, and 1M sqm by 2027.

FILRT boasts high quality office properties with tenants from the resilient BPO sector, with strong presence of Filinvest Land, Inc. The total valuation of the land is valued at PHP 48.55 Billion out of the 301,362 sqm of GLA. Out of the total GLA, 88.4% of the tenants are from the BPO sector (8.1% traditional, 2.8% POGO, and 0.7% retail), and has at least a 90.3% occupancy rate, with at least 3.9 years of Weighted Average Lease Expiry (WALE) by GLA.

 

Summary offer

Filinvest REIT (FILRT) is looking to raise as much as PhP 14.9 Billion from the REIT offering at a price of PhP8.30/share. FILRT will sell 1.63 Billion shares, with an overallotment option of 163 Million shares. All proceeds will be used by FILRT in accordance with its reinvestment plan.

 

High-grade quality

FLI has numerous of high quality Grade A office portfolio in a key CBD with strong historical office rental growth and net absorption. The properties estimated to be valued at PhP 48.5 Billion as of March 2021.

 

Property inclusion

Among the assets that will be included in the REIT portfolio will be 16 office towers and will be mostly have a retail component. This will have a total GLA of 301,362 sqm of GLA including Northgate Cyberzone and one office tower in Cebu.

 

Dividend Yield

At an indicative offer price of PHP 8.30/share, this will be equivalent to 5.3-5.9% based on 2021 earnings and 5.6-6.2% based on 2022 earnings. This will be at par with the median average dividend yield for the region of 5.5% and 5.7% for 2021 and 2022, respectively.

 

FINANCIAL HIGHLIGHTS

 

Check out these other Premium-exclusive FILRT IPO Special Reports!

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Filinvest REIT (FILRT) Special Report: Buy the IPO?

 

 

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AB Capital Securities
AB Capital Securities

AB Capital Securities is one of PinoyInvestor’s partners in delivering superior and reliable stock research reports that help Filipino investors make smart stock investing decisions! Learn more about them here.