Mapletree Industrial Trust Earnings: Data Centers to Drive Growth for the Next Five Years

No-moat Mapletree Industrial Trust’s, or MIT’s, first-quarter fiscal 2025 (ending March) results were slightly below our expectations, with its Singapore industrial portfolio occupancy rate staying flat on a quarter-on-quarter basis against our anticipated improvement. That said, the trust achieved a positive rental reversion of 9.2% and lengthened its weighted average lease expiry to 4.6 years from 4.4 years after securing a long lease commitment of 30 years from the new tenant at 402 Franklin Road, Brentwood, during the quarter. The trust resumed its distribution reinvestment plan to allow unitholders to take its distribution in units instead of cash. Management expects this plan to strengthen the trust’s balance sheet and give it more financial flexibility to pursue growth opportunities. After fine-tuning our occupancy assumptions, we cut our fiscal 2025-27 distribution per unit estimates slightly by 1.2%-2.6%. Our fair value estimate of SGD 2.30 per unit remains unchanged. We think the trust is fairly valued currently and investors should wait for a better entry price.