Digital Core REIT: Riding the Data Centre Wave

Digital Core REIT, a leading pure-play data center REIT listed in Singapore and sponsored by Digital Realty, continues to deliver robust performance. The REIT declared a distribution per unit (DPU) of 1.80 U.S. cents for the six months ending December 31, 2024, set to be paid on March 28, 2025. With a diversified portfolio of 10 mission-critical facilities valued at \$1.6 billion across the United States, Canada, Germany, and Japan, the REIT remains a strong player in the data center market.

For 2024, Digital Core REIT achieved a cash rental rate reversion of 4.3% on renewal leases, with \$74 million in annualized rent from new and renewal leases. Its portfolio occupancy stood at an impressive 96.7%, with a weighted average lease expiration of 4.8 years.

Investment activities included the sale of two Silicon Valley properties for \$178 million in January 2024 and several acquisitions, such as a 10% interest in a flagship Osaka data center for \$51.5 million and a 40% interest in a Frankfurt facility for \$1.034 billion. These transactions highlight the REIT’s focus on de-risking its portfolio and extending its debt maturity.

The REIT repurchased 27 million units at an average price of \$0.576, generating DPU accretion of approximately 1.8%. With a leverage ratio of 34%, a weighted average debt maturity of 4.7 years, and 86% of its interest exposure hedged, Digital Core REIT’s financial stability is commendable.

At \$0.515 per unit, the REIT trades at a 7% yield and 0.8x book value, offering a significant 50% upside to its one-year consensus target price of \$0.78. Lim & Tan Securities recommends an “Accumulate” rating, citing attractive valuations and strong growth prospects driven by AI, electrification, and autonomous technologies.

iFast Corporation: Record-Breaking Growth in FY2024

iFast Corporation achieved stellar performance in FY2024, with its assets under administration (AUA) reaching a record \$25.01 billion, reflecting a 26.2% year-on-year growth. This was driven by net inflows of \$3.30 billion and continuous improvement in its wealth management platform. The Group’s total revenue for 4Q2024 surged 26.7% year-on-year to \$104.14 million, while net profit soared 46.3% to \$19.28 million.

For the full year, net revenue grew by 53.6% year-on-year to \$248.38 million, and net profit increased by 135.7% to \$66.63 million. The Group’s non-banking operations reported a profit before tax of \$88.19 million, up 89.9% year-on-year, and net profit of \$70.99 million, a 92.5% increase.

iFast Global Bank achieved profitability in 4Q2024, with customer deposits crossing \$1.01 billion—a 182.6% increase. The Digital Personal Banking division played a key role, contributing to a 163.7% growth in gross revenue and a 136.4% increase in net revenue.

Looking ahead, iFast aims to grow its AUA to \$100 billion by 2028-2030 and enhance its digital banking and fintech services. However, given its current valuation of \$2.3 billion, trading at 20.7x forward PE and 7.2x PB, Lim & Tan Securities has a “Hold” rating due to relatively high valuations compared to Singapore’s major banks.

Frasers Logistics and Commercial Trust: Stable Dividends

Frasers Logistics and Commercial Trust offers a forward dividend yield of 7.59%, making it one of the highest-yielding trusts in Singapore. Despite its attractive dividend payouts, the report does not provide detailed financial metrics or recommendations for this trust.

Other Highlights and Market Trends

The report also discusses macroeconomic trends impacting the U.S., Hong Kong, and China markets. U.S. economic momentum from late 2024 is expected to fade in 2025, with risks of a major equity bear market later in the year. Meanwhile, Huawei’s revenue exceeded 860 billion yuan in 2024, marking a 22% year-on-year growth, driven by a strong comeback in its consumer business.

For Singapore, institutional investors recorded a net sell of \$130.6 million during the week of February 3, 2025, while retail investors showed a net buy of \$256.6 million. Top institutional net buys included SGX and Singtel, while DBS and OCBC were among the top retail net buys.

Dividends and Upcoming Events

Several companies announced dividends, including Digital Core REIT’s 1.8 U.S. cents and DBS Group’s 60 cents per share. Upcoming results announcements include major players like UOB, Wilmar, and SIA, scheduled throughout February 2025.