► TA SECURITIES
A MEMBER OF THE TA GROUP
A MEMBER OF THE TA GROUP
RESULTS UPDATE
Tuesday, July 22, 2025
FBMKLCI: 1,524.59
Sector: REIT
Tuesday, July 22, 2025
FBMKLCI: 1,524.59
Sector: REIT
THIS REPORT IS STRICTLY FOR INTERNAL CIRCULATION ONLY*
CapitaLand Malaysia Trust (CLMT): Industrial Expansion on Track
Review
- CapitaLand Malaysia Trust (CLMT)’s IH25 realised net profit of RM72.6mn came in within expectations, accounting for 49% of both ours and consensus’ full-year forecasts.
- CLMT declared a first income distribution of 2.46sen/unit (+4.2% YoY) for IH25, which was also in line with our full-year DPU projection of 5.0sen. This translates to an annualised dividend yield of 7.6% based on the last closing price.
- Net property income (NPI) rose 7.3% YoY to RM138.8mn in IH25, underpinned by positive rental reversions, rental step-ups, and new income contributions from Glenmarie Distribution Centre and Senai Airport City Facilities, which commenced rental recognition in January and June 2025, respectively.
- On a sequential basis, NPI eased by 1.9% to RM68.7mn in 2Q25, mainly due to the normalisation of gross turnover rent. The first quarter benefitted from higher festive shopping sales, which boosted variable rental collections.
- As of 30 June 2025, CLMT continued to enjoy strong support from its malls outside the Klang Valley, which achieved impressive occupancy levels of over 99%. Meanwhile, retail rental reversion remained encouraging at +10.8% in 1H25.
- In terms of lease expiry profile, 20% of CLMT’s leases by gross rental income are due for renewal in 2025, followed by 30% in 2026, and 50% in 2027 and beyond. A significant portion of the 2025 expiries comes from high-performing malls outside the Klang Valley, presenting a solid opportunity for further rental income uplift. As at end-2Q25, approximately 47.1% of the leases due in 2025 have already been renewed.
Impact
- No change to our FY25-FY27 earnings forecasts.
Conference Call Highlights
- A key concern raised during the conference call was the potential impact of the 8% SST on commercial property rentals, effective 1 July 2025. The tax is expected to increase tenants’ operating costs and could dampen rental reversion potential. Some tenants have approached the REIT to explore possible mitigation measures, but management has no plans to make concessions at this stage. Notably, CLMT’s flagship malls, Gurney Plaza, Queensbay Mall, and East Coast Mall, which collectively contributed 93% of FY24 NPI, are expected to be more resilient to tenant pushback, supported by their high occupancy, strong tenant demand, and established market positions.
- Following the completion of three industrial property acquisitions in Senai Airport City (Johor) in June, management shared that the remaining acquisitions, comprising a logistics facility in Elmina Business Park (Selangor) and three freehold factories in Nusajaya Tech Park (Johor), are on track to be completed by 3Q25. These assets, with a combined value of RM279mn, are expected to deliver an initial yield of 6.8%-7.3%. Furthermore, the leases include built-in step-up rental clauses, which will provide additional support for future rental growth.
- Separately, management shared that the proposed private placement to raise up to RM250mn is expected to be completed in 3Q25. A Unitholders’ Meeting is scheduled for 22 July 2025 to seek approval for the exercise. The proceeds will primarily be used to repay borrowings related to the RM400mn acquisition of nine industrial and logistics assets. This fund raising forms part of CLMT’s broader strategy to optimise its capital structure, enhance balance sheet flexibility, and create additional headroom for future growth opportunities. Upon completion, the placement is expected to reduce CLMT’s gearing from 43.0% to 39.6%.
Valuation
- We maintain our target price at RM0.82 per share, which is derived from a target yield of 6.75% based on our projected CY26 dividend per share of 5.4 sen. The valuation also includes a 3% ESG premium, reflecting CLMT’s 4-star ESG rating. Reiterate Buy.
TP: RM0.82 (+26.6%)
Last Traded: RM0.65
Last Traded: RM0.65
Buy (ESG: ★★★★)
Share Information
- Bloomberg CodeCLMT MK
- Stock Code5180
- ListingMain Market
- Share Cap (mn)2,921.4
- Market Cap (RMmn)1,898.9
- 52-wk Hi/Lo (RM)0.705/0.55
- 12-mth Avg Daily Vol (‘000 shrs)1,299.2
- Estimated Free Float (%)45.4
- Beta0.4
Major Shareholders (%)
- CapitaLand Ltd35.3
- Employees Provident Fund15.3
- Amanah Saham Nasional12.6
- Kumplan Wang Persaraan8.0
Forecast Revision
| FY25 | FY26 | |
|---|---|---|
| Forecast Revision (%) | 0.0 | 0.0 |
| Net profit (RMmn) | 147.5 | 160.1 |
| Consensus | 146.6 | 157.8 |
| TA’s / Consensus (%) | 100.6 | 101.4 |
| Previous Rating | Buy (Maintained) | |
| Consensus TP (RM) | 0.76 | |
Financial Indicators
| FY25 | FY26 | |
|---|---|---|
| Net gearing (%) | 40.8 | 40.6 |
| CFPS (sen) | 9.8 | 8.8 |
| P/CFPS (x) | 6.6 | 7.3 |
| ROE (%) | 5.1 | 5.5 |
| ROA (%) | 2.8 | 3.0 |
| NTA/Share (RM) | 1.0 | 1.0 |
| Price/ NTA (x) | 0.6 | 0.6 |
Scorecard
| % of FY | ||
|---|---|---|
| vs. TA | 49.2 | Within |
| vs. Consensus | 49.4 | Within |
Share Performance (%)
| Price Change | CLMT | FBM KLCI |
|---|---|---|
| 1 mth | 1.6 | 1.5 |
| 3 mth | 3.2 | 1.7 |
| 6 mth | (2.3) | (3.5) |
| 12 mth | (1.5) | (6.8) |
(12-Mth) Share Price relative to the FBMKLCI
[Chart Area]
Source: Bloomberg
Table 1: Earnings Summary (RM mn)
| FYE Dec | FY23 | FY24f | FY25f | FY26f | FY27f |
|---|---|---|---|---|---|
| Gross Rental Income | 395.4 | 454.8 | 514.2 | 524.9 | 545.5 |
| Net Property Income | 217.4 | 263.9 | 277.4 | 290.7 | 300.0 |
| NPI Margins (%) | 55.0 | 58.0 | 53.9 | 55.4 | 55.0 |
| Pretax profit | 113.9 | 140.9 | 147.5 | 160.1 | 166.3 |
| Core Net Profit | 111.2 | 132.5 | 147.5 | 160.1 | 166.3 |
| Distributable income | 109.8 | 132.8 | 157.0 | 169.8 | 176.2 |
| Core EPU (sen) | 4.2 | 4.7 | 5.2 | 5.6 | 5.9 |
| Core EPU Growth (%) | 1.7 | 11.0 | 10.7 | 8.5 | 3.9 |
| PER (x) | 15.3 | 13.8 | 12.5 | 11.5 | 11.1 |
| DPU (sen) | 4.2 | 4.7 | 5.0 | 5.4 | 5.6 |
| Div Yield (%) | 6.4 | 7.2 | 7.7 | 8.3 | 8.6 |
| ROE (%) | 4.3 | 4.7 | 5.1 | 5.5 | 5.7 |
Table 2: 2QFY25 Results Analysis (RM mn)
| FYE Dec | 2Q24 | 1Q25 | 2Q25 | QoQ (%) | YoY (%) | 1H24 | 1H25 | YoY (%) |
|---|---|---|---|---|---|---|---|---|
| Gross Revenue | 113.7 | 120.4 | 115.7 | (3.9) | 1.8 | 225.5 | 236.1 | 4.7 |
| Net property income | 65.5 | 70.1 | 68.7 | (1.9) | 5.0 | 129.4 | 138.8 | 7.3 |
| Interest Income | 0.4 | 0.8 | 0.8 | 3.0 | 89.5 | 1.0 | 1.6 | 59.3 |
| Change in fair value of inv prop | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 | 0.0 |
| Net investment Income | 65.9 | 69.5 | 68.0 | (2.3) | 3.1 | 130.5 | 137.5 | 5.4 |
| Finance Costs | (24.9) | (24.4) | (25.2) | 3.2 | 1.1 | (48.6) | (49.6) | 2.0 |
| Other trust expenses | (1.1) | (0.5) | (0.4) | (2.8) | (58.9) | (1.7) | (0.9) | (47.1) |
| Income before taxation | 33.0 | 37.5 | 35.1 | (6.5) | 6.4 | 66.4 | 72.6 | 9.5 |
| Net profit | 33.5 | 37.5 | 35.1 | (6.5) | 4.8 | 67.0 | 72.6 | 8.4 |
| Realised Net Profit | 33.5 | 37.5 | 35.1 | (6.5) | 4.8 | 67.0 | 72.6 | 8.4 |
| Income available for distribution | 33.3 | 37.3 | 34.6 | (7.3) | 3.9 | 66.9 | 71.9 | 7.4 |
| EPU (sen) | 1.2 | 1.3 | 1.2 | (7.7) | 1.7 | 2.4 | 2.5 | 4.2 |
| DPU (sen) | 1.2 | 1.3 | 1.2 | (7.8) | 0.9 | 2.4 | 2.5 | 4.2 |
| ppt | ppt | ppt | ||||||
| NPI Margin (%) | 57.6 | 58.2 | 59.4 | 1.2 | 1.8 | 57.4 | 58.8 | 1.4 |
| Core Net Margin (%) | 29.4 | 31.1 | 30.3 | (0.8) | 0.9 | 29.7 | 30.7 | 1.0 |
Sector Recommendation Guideline
OVERWEIGHT: The total return of the sector, as per our coverage universe, exceeds 12%.
NEUTRAL: The total return of the sector, as per our coverage universe, is within the range of 7% to 12%.
UNDERWEIGHT: The total return of the sector, as per our coverage universe, is lower than 7%.
Stock Recommendation Guideline
BUY : Total return of the stock exceeds 12%.
HOLD : Total return of the stock is within the range of 7% to 12%.
SELL : Total return of the stock is lower than 7%.
Not Rated: The company is not under coverage. The report is for information only.
Total Return of the stock includes expected share price appreciation, adjustment for ESG rating and gross dividend. Gross dividend is excluded from total return if dividend discount model valuation is used to avoid double counting.
Total Return of the sector is market capitalisation weighted average of total return of the stocks in the sector.
ESG Scoring & Guideline
| Environmental | Social | Governance | Average | |
|---|---|---|---|---|
| Scoring | ★★★★ | ★★★★ | ★★★★ | ★★★★ |
| Remark | CLMT’s sponsor, CapitaLand is a signatory to the United Nations (UN) Global Compact. In line with its sponsor, the REIT implements a comprehensive programme aiming to reduce to GHG emission, water & waste with relevant targets and deadlines. | As a real estate operator, CLMT has a low exposure to social risks given that the sector is not labour-intensive, maintains good community relations, and faces no material safety issues. | 5 out of 8 of CLMT’s board members are independent. It has four female directors (50%). CLMT holds investor briefings regularly, demonstrating good transparency and disclosure practices. |
| ★★★★★ (≥80%) | Displayed market leading capabilities in integrating ESG factors in all aspects of operations, management and future directions. | +5% premium to target price |
| ★★★★ (60-79%) | Above adequate integration of ESG factors into most aspects of operations, management and future directions. | +3% premium to target price |
| ★★★ (40-59%) | Adequate integration of ESG factors into operations, management and future directions. | No changes to target price |
| ★★ (20-39%) | Have some integration of ESG factors in operations and management but are insufficient. | -3% discount to target price |
| ★ (<20%) | Minimal or no integration of ESG factors in operations and management. | -5% discount to target price |
