Mixed views on Pavilion REIT

Pavilion Real Estate Investment Trust (Pavilion REIT) received generally
mixed reviews from research houses after the company released its
results for its first quarter of financial year 2013.


For the first quarter ended March 31, 2013, its net profit rose to
RM54.2 million from RM47.8 million in the same period of 2012.


Its revenue increased to RM94.75 million from RM85.33 million previously.


In a note today, HwangDBS Vickers Research said Pavilion REIT's net
profit was in line with expectations, 14 per cent higher compared to the
same period of 2012, driven by higher retail and office revenues.






"This was mainly contributed by retail rental from Fashion Avenue which
commenced in third quarter of 2012 and Pavilion Office Tower being fully
tenanted from third quarter 2012," it said.


HwangDBS Vickers Research said Pavilion REIT was still a prime
beneficiary of a positive Malaysian macroeconomic and retail outlook and
could see stronger gains when mass rapid transit works works and links
to Fahrenheit88, Banyan Tree Signatures and upcoming Harrods Hotel were
completed."


The research house has maintained a 'buy' call on the stock with a target price (TP) of RM1.70.



RHB Research said Pavilion REIT's results were in line with the research house's and consensus estimates.


It said the opening of Fashion Avenue in the third quarter of 2012
has seen the doubling of rental revenue from the area which was
previously tenanted by an anchor tenant, CK Tang.


"We reiterate that the REIT's next earnings kicker will likely be
its major rental renewals in the third quarter of this year," it said.


The research house has maintained its 'buy' call on the counter with a TP of RM1.66.


Alliance Research said the results came in better than expected,
with core profit making up 23.6 per cent of the research house's and
consensus full-year forecast.


The research house has maintained its 'neutral' call with higher TP of RM1.61 from RM1.51 previously.-- Bernama