Keppel DC REIT (KPDCF – Research Report), the Real Estate sector company, was revisited by a Wall Street analyst yesterday. Analyst Jonathan Koh from UOB Kay Hian maintained a Buy rating on the stock and has a S$2.55 price target.
Jonathan Koh has given his Buy rating due to a combination of factors that highlight Keppel DC REIT’s strategic positioning and growth potential. The REIT is benefiting from a supply-constrained market in Singapore, where the limited availability of new data centre capacity is expected to sustain positive rental reversions into 2025 and 2026. This environment supports stable and potentially increasing income streams for the REIT.
Moreover, the recent acquisition of SGP7 and SGP8 data centres is expected to be accretive, contributing positively to the distribution per unit (DPU) and enhancing the REIT’s portfolio with assets designed for AI applications. Additionally, the divestment of the Kelsterbach Data Centre in Germany aligns with Keppel DC REIT’s strategic shift towards focusing on hyperscale data centres, which are seen as a growth area. The management’s proactive approach in seeking further acquisitions in key markets like Japan, South Korea, and Europe further underscores the REIT’s commitment to capitalizing on emerging trends in the data centre industry.
According to TipRanks, Koh is a 2-star analyst with an average return of 0.0% and a 49.61% success rate. Koh covers the Real Estate sector, focusing on stocks such as Keppel DC REIT, Mapletree Logistics, and Frasers Logistics & Commercial Trust.