Centuria Industrial REIT

This report is an updated version of the report published on the 4^th October 2022 at 3:14 PM (GMT+11) AEST

Section 1: Company Overview and Fundamentals Insights

1.1 Company Overview

Centuria Industrial REIT (ASX: CIP) is engaged in building investment properties portfolio and got listed in ASX in December 2012. The company’s portfolio of industrial assets is located in urban infill throughout Australia and is supported by diverse tenant base.

1.2 The Key Positives, Negatives, Investment Highlights, and Risks

1.3 Top 10 Shareholders: The top 10 shareholders together form ~39.75% of the total shareholding. Centuria Capital Group and Vanguard Investments Australia Ltd. are holding a maximum stake in the company at ~16.12% and ~7.62%, respectively.

1.4 Key Metrics: In FY22, CIP recorded a return on equity of 15.3%, compared to the Industry Median figure of 12.0%. The net margin for the period stood at 180.5%, higher than the Industry Median figure of 113.3%. The below picture depicts the EBITDA margin and current ratio trend since FY19:

Section 2: Business Updates and Financial Highlights

2.1 Recent Updates:

2.2 Results Highlights of FY22: FY22 has been an encouraging year for CIP, with higher portfolio leasing activity, value-add projects, and acquisitions synergies, which aided the company in upgrading its FFO guidance. CIP leased more than 185,000sqm across 49 transactions in FY22.

The below picture depicts CIP’s initiatives to build five-star Green Star design within its development pipeline:

Section 3: Key Risks and Outlook:

Section 4: Stock Recommendation Summary

4.1 Price Performance and Technical Summary

4.2 Fundamental Valuation

Valuation Methodology: P/E Multiple Based Relative Valuation (Illustrative)

Markets are trading in a highly volatile zone currently due to certain macroeconomic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.

Note 1: The reference date for all price data, currency, technical indicators, support, and resistance levels is October 4, 2022. The reference data in this report has been partly sourced from REFINITIV.

Note 2: Investment decisions should be made depending on an individual's appetite for upside potential, risks, holding duration, and any previous holdings. An 'Exit' from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.

Technical Indicators Defined: -

Support: A level at which the stock prices tend to find support if they are falling, and downtrend may take a pause backed by demand or buying interest.

Resistance: A level at which the stock prices tend to find resistance when they are rising, and uptrend may take a pause due to profit booking or selling interest.

Stop-loss: In general, it is a level to protect further losses in case of any unfavourable movement in the stock prices.

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