Viva Industrial Trust's income jumps 41% to $17.2m in Q2

Thanks to acquisitions and AEIs.

Viva Industrial Trust’s (VIT) asset enhancement initiatives (AEIs) have begun to bear fruit, as the group reported a 41% YoY surge in net property income to $17.2m in Q2.

According to the company’s media release, the growth is also thanks to VIT’s strategic acquisitions during the quarter.

Moreover, OCBC asserts in a report that VIT’s gross revenue jumped 31.3% YoY to $23.4m. Meanwhile, VIT’s DPU slipped 5.4% YoY to 1.750 S cents.

“Based on yesterday’s closing price of S$0.77, VIT is currently trading at a forward FY16F DPU yield of 8.9% and a FY17F yield of 9.5% according to our forecasts,” OCBC notes.

“In light of the accommodative low interest rate environment, we decrease our risk-free rate from 3.0% to 2.4% and our dividend discount model (DDM) cost of equity falls to 8.4%. Along with updated assumptions for VBP and UEBH, our fair value increases from S$0.75 to S$0.76,” it further asserts.