Aventus Retail Property Fund

Increase in the portfolio value as at 30^th June 2018: Aventus Retail Property Fund’s (ASX: AVN) preliminary valuation showed the increase in the portfolio value as at 30^th June 2018. The revaluation of the company’s portfolio as at 30 June 2018 shows a $42 million increase ($18 million net of capital expenditure) in the value of the portfolio to $1.892 billion. The preliminary $18 million net valuation gain will increase the Net Tangible Assets (NTA) of the Fund by approximately 4 cents per security. On the other hand, AVN has declared the distribution of 4.07 cents per unit for the quarter ending 30 June 2018.
 
Additionally, AVN expects FY18 FFO per unit to be 2% - 3% higher than FY17 FFO per unit. The company had improved the quality of the portfolio through the acquisition of dominant centres at Castle Hill and Marsden Park and through the divestment of smaller centres at Shepparton and Tweed, with total value of total capital transactions of approximately $500 million for the half. The company’s average centre value is now $93 million, which is an increase of 44% since listing in October 2015. Meanwhile, AVN stock has risen 4.19% in three months as on June 29, 2018  and is trading at a P/E of 5.86x and dividend yield of 7.24%.
 

Top Tenants (Source: Company Reports)
 
The group’s dividend position looks strong while it has resilient fundamentals and has leased properties to retailers including Bunnings and Harvey Norman Holdings Limited. Thus, the group caters to big players and has a lower chance to suffer any default on operations’ side. The group maintains a high occupancy at 98.6% for 1H FY18, up 30 bps from 98.3%. It also started major expansion of Tuggerah, added 10,000 sqm in GLA and expansions to Peninsula and Cranbourne are underway.
 
Based on the foregoing, we give a “Speculative Buy” recommendation on the stock at the current price of $ 2.240.
 

Investment Property Portfolio Valuation (Source: Company Reports)

 
Disclaimer
 
The advice given by Kalkine Pty Ltd and provided on this website is general information only and it does not take into account your investment objectives, financial situation or needs. You should therefore consider whether the advice is appropriate to your investment objectives, financial situation and needs before acting upon it. You should seek advice from a financial adviser, stockbroker or other professional (including taxation and legal advice) as necessary before acting on any advice. Not all investments are appropriate for all people. Kalkine.com.au and associated pages are published by Kalkine Pty Ltd ABN 34 154 808 312 (Australian Financial Services License Number 425376). The information on this website has been prepared from a wide variety of sources, which Kalkine Pty Ltd, to the best of its knowledge and belief, considers accurate. You should make your own enquiries about any investments and we strongly suggest you seek advice before acting upon any recommendation. Kalkine Pty Ltd has made every effort to ensure the reliability of information contained in its newsletters and websites. All information represents our views at the date of publication and may change without notice. To the extent permitted by law, Kalkine Pty Ltd excludes all liability for any loss or damage arising from the use of this website and any information published (including any indirect or consequential loss, any data loss or data corruption). If the law prohibits this exclusion, Kalkine Pty Ltd hereby limits its liability, to the extent permitted by law to the resupply of services. There may be a product disclosure statement or other offer document for the securities and financial products we write about in Kalkine Reports. You should obtain a copy of the product disclosure statement or offer document before making any decision about whether to acquire the security or product. The link to our Terms & Conditions has been provided please go through them and also have a read of the Financial Services Guide. On the date of publishing this report (mentioned on the website), employees and/or associates of Kalkine Pty Ltd do not hold positions in any of the stocks covered on the website. These stocks can change any time and readers of the reports should not consider these stocks as advice or recommendations.