AXIS REIT
DESCRIPTION
One of the leading REIT player which owns and invests mainly in commercial, office and industrial assets.
| 12-Month Target Price | RM1.96 |
| Current Price | RM1.83 |
| Expected Return | +7.1% |
| Previous Target Price | RM1.96 |
| Market | Main |
| Sector | REIT |
| Bursa Code | 5106 |
| Bloomberg Ticker | AXRB MK |
| Shariah-Compliant | Yes |
SHARE PRICE CHART
Chart data unavailable. Price movement from Jan-25 to Jul-25 shows a general upward trend from approx. 1.70 to 1.83.
| 52 Week Range (RM) | 1.71 – 2.05 |
| 3-Month Average Vol (‘000) | 1,653.1 |
SHARE PRICE PERFORMANCE
| 1M | 3M | 12M | |
|---|---|---|---|
| Absolute Returns | 0.0 | 4.5 | 13.6 |
| Relative Returns | -0.2 | 1.6 | 13.7 |
KEY STOCK DATA
| Market Capitalisation (RMm) | 3,698.1 |
| No. of Shares (m) | 2,020.8 |
MAJOR SHAREHOLDERS
| % | |
|---|---|
| EPF | 17.6 |
| KWAP | 10.1 |
| LTH | 5.9 |
Tan Siang Hing
T 603 2268 3000
F 603 2268 3014
E research@publicinvestbank.com.my
Within Expectations
Axis REIT’s (AXREIT) 2QFY25 realised net profit came in at RM51.6m (+31.1% YoY, +2.6% QoQ), which was within our and consensus expectations. YTD, the Group registered realised net profit of RM101.9m (+28.5% YoY), which constituted about 50% and 49% of our and consensus full year estimates, respectively. 2QFY25 profits were lifted slightly by gains of disposal of investment property i.e. the disposal of “The Annex” which completed on 30 April 2025, resulting in a total net gain on disposal of RM8.8m. Separately, it has achieved 100% occupancy for its newly developed Axis Mega Distribution Centre (Phase 2) in January 2025. All told, we maintain our earnings estimates and keep our Neutral call with TP unchanged at RM1.96, based on dividend yield of about 5%.
- 1HY25 NPI rose 20.5% YoY to RM155.6m, mainly due to contribution from rental contribution from newly acquired properties, higher contribution from Axis Mega Distribution Centre (Phase 2) which was fully leased out in January 2025 and positive rental reversion from the existing portfolio. Meanwhile, property expenses rose 6.1% YoY to RM23.7m mainly due to the increased number of properties in the portfolio.
- Looking for more assets worth RM430m. Its assets under management (AUM) has increased to RM5.26bn in FY24 after completing a record 8 acquisitions during the year, raising its portfolio count to 68 properties with 15.11msf of space under management. It has in the pipeline a plan to acquire assets worth RM430m in FY25, focusing on Grade A logistics facilities and manufacturing facilities with long leases from tenants with strong covenants; well-located logistics warehousing in locations ideal for last-mile distribution; and office, business parks & industrial properties with potential for future enhancement.
KEY FORECAST TABLE
| FYE Dec (RM m) | 2023A | 2024A | 2025F | 2026F | 2027F | CAGR |
|---|---|---|---|---|---|---|
| Revenue | 286.0 | 320.1 | 363.4 | 374.1 | 382.3 | 7.5% |
| Pre-tax Profit | 221.6 | 212.5 | 202.3 | 207.0 | 231.6 | 1.1% |
| Reported Net Profit | 217.8 | 210.0 | 202.3 | 207.0 | 231.6 | 1.5% |
| Realised Net Profit | 145.4 | 162.8 | 202.3 | 207.0 | 231.6 | 12.3% |
| Realised EPS (Sen) | 8.7 | 8.1 | 10.0 | 10.2 | 11.5 | 7.1% |
| P/E (x) | 21.0 | 22.6 | 18.3 | 17.9 | 16.0 | |
| DPS (Sen) | 8.7 | 8.1 | 10.0 | 10.2 | 11.5 | |
| Dividend Yield (%) | 4.8 | 4.4 | 5.5 | 5.6 | 6.3 |
Source: Company, PublicInvest Research estimates
Figure 1: Results Summary
| FYE Dec (RM m) | 2QFY25 | 2QFY24 | YoY chg (%) | 1QFY25 | QoQ chg (%) | YTD FY25 | YTD FY24 | YoY chg (%) |
|---|---|---|---|---|---|---|---|---|
| Gross Rental Income | 90.3 | 76.5 | 17.9 | 89.9 | 0.4 | 180.1 | 152.1 | 18.4 |
| Net property income | 79.1 | 66.0 | 19.9 | 78.2 | 1.1 | 157.3 | 132.1 | 19.1 |
| Interest income | 0.4 | 0.3 | 30.1 | 0.4 | (12.5) | 0.7 | 0.6 | 17.9 |
| Revaluation gain | (4.5) | (1.3) | nm | 0.4 | nm | (6.0) | 0.0 | nm |
| Other exceptional items | 0.9 | 0.7 | nm | -1.4 | (161.9) | 0.9 | 0.0 | #DIV/0! |
| Non-property expenses | 27.6 | 25.7 | 7.3 | 27.6 | (0.1) | 55.2 | 50.1 | 10.0 |
| Finance costs | 17.7 | 17.4 | 1.7 | 17.8 | (0.3) | 35.5 | 33.4 | 6.2 |
| Income before tax | 47.5 | 39.0 | 22.0 | 49.1 | (3.2) | 96.6 | 81.2 | 19.0 |
| Taxation | (0.6) | 0.0 | nm | 0 | nm | (0.6) | 0.0 | nm |
| Income after tax | 47.0 | 39.0 | 20.5 | 49.1 | (4.4) | 96.1 | 81.2 | 18.3 |
| Income after tax – realised | 51.6 | 39.4 | 31.1 | 50.3 | 2.6 | 101.9 | 79.3 | 28.5 |
| EPU ex-EI (sen) | 2.3 | 2.2 | 4.0 | 2.4 | (3.3) | 4.8 | 4.7 | 2.4 |
| DPU (sen) | 2.7 | 2.3 | 17.8 | 2.5 | 6.0 | 5.2 | 4.6 | 13.2 |
Source: Company, PublicInvest Research
KEY FINANCIAL DATA
INCOME STATEMENT DATA
| FYE Dec (RM m) | 2023A | 2024A | 2025F | 2026F | 2027F |
|---|---|---|---|---|---|
| Revenue | 286.0 | 320.1 | 363.4 | 374.1 | 382.3 |
| Total Expenses | 83.4 | 84.7 | 86.1 | 87.6 | 89.1 |
| Pre-tax Profit | 221.6 | 212.5 | 202.3 | 207.0 | 231.6 |
| Income Tax | 3.8 | 2.5 | 0.0 | 0.0 | 0.0 |
| Effective Tax Rate (%) | -1.7 | -1.2 | 0.0 | 0.0 | 0.0 |
| Minorities | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
| Reported Net Profit | 217.8 | 210.0 | 202.3 | 207.0 | 231.6 |
| Realised Net Profit | 145.4 | 162.8 | 202.3 | 207.0 | 231.6 |
Growth
| 12% | 14% | 3% | 2% | ||
|---|---|---|---|---|---|
| Revenue | 2% | 12% | 14% | 3% | 2% |
| Pre-tax Profit | 16% | -4% | -5% | 2% | 12% |
| Reported Net Profit | 14% | -4% | -4% | 2% | 12% |
| Realised Net Profit | -8% | 12% | 24% | 2% | 12% |
BALANCE SHEET DATA
| FYE Dec (RM m) | 2023A | 2024A | 2025F | 2026F | 2027F |
|---|---|---|---|---|---|
| Property, Plant & Equipment | 4,444.1 | 5,091.9 | 5,114.1 | 5,164.1 | 5,184.1 |
| Cash and Cash Equivalents | 51.7 | 120.7 | 125.9 | 138.4 | 149.9 |
| Receivables, deposits and prepayment | 25.7 | 22.9 | 29.1 | 29.4 | 29.6 |
| Other Assets | 1.4 | 23.0 | 126.3 | 73.5 | 51.8 |
| Total Assets | 4,522.9 | 5,258.6 | 5,395.5 | 5,405.5 | 5,415.5 |
| Payables | 62.8 | 116.9 | 118.7 | 121.3 | 123.3 |
| Borrowings | 1,555.0 | 1,750.4 | 1,721.3 | 1,799.7 | 1,828.0 |
| Deferred tax | 18.3 | 20.3 | 18.3 | 18.3 | 18.3 |
| Other Liabilities | 60.9 | 71.9 | 111.1 | 40.2 | 19.8 |
| Total Liabilities | 1,696.9 | 1,959.5 | 1,969.5 | 1,979.5 | 1,989.5 |
| Shareholders’ Equity | 2,826.0 | 3,299.1 | 3,426.0 | 3,426.0 | 3,426.0 |
| Total Equity and Liabilities | 4,522.9 | 5,258.6 | 5,395.5 | 5,405.5 | 5,415.5 |
PER SHARE DATA & RATIOS
| FYE Dec | 2023A | 2024A | 2025F | 2026F | 2027F |
|---|---|---|---|---|---|
| Book Value Per Share | 1.6 | 1.6 | 1.7 | 1.7 | 1.7 |
| NTA Per Share | 1.6 | 1.6 | 1.7 | 1.7 | 1.7 |
| EPS (Sen) | 8.7 | 8.1 | 10.0 | 10.2 | 11.5 |
| DPS (Sen) | 8.7 | 8.1 | 10.0 | 10.2 | 11.5 |
| Payout Ratio (%) | 100.0 | 100.0 | 100.0 | 100.0 | 100.0 |
| ROA (%) | 4.8 | 4.0 | 3.7 | 3.8 | 4.3 |
| ROE (%) | 7.7 | 6.4 | 5.9 | 6.0 | 6.8 |
Source: Company (actual), PublicInvest Research estimates
RATING CLASSIFICATION
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