On 5 August 2025, CapitaLand Integrated Commercial Trust (“CICT”) announced their half year result for FY2025. This is the period where investors can see the positive effects of contribution from ION orchard, which, together with the lower interest rates, has seen DPU increase this half a year. With market expectations that interest rates will continue to be lowered over the next few quarters, CICT may be able to further lower their cost of debt.
Do note that subsequent to quarter end, CICT announced the completion of private placement of new shares at SGD2.11 per new unit. The use of proceeds is mainly to finance the proposed acquisition of the remaining 55.0% interest in the office and retail component of CapitaSpring, as well as repayment and refinancing of debt, capital expenditure and asset enhancement initiatives. Management has disclosed that the acquisition will enhance CICT’s leading position as the owner of premium offices in Singapore’s Central Area.
With the private placement, the upcoming distribution to be paid in September 2025 covers the period up to 13 August 2025 instead of the usual end of the reporting period. Therefore, it is different from the reported DPU in the financial result release.
Disclaimer: Not financial advice. All data and information provided on this site is for informational purposes only.
Website: Financial Statements And Related Announcement::Half Yearly Results
Photo source: https://fifthperson.com/cmt-cct-merger-pros-cons/
Financial Highlights
Distribution Per Unit (“DPU”)
| Metrics | Current | Previous |
|---|---|---|
| Distribution Per Unit | +3.1% | No Update |
| Rating | Favorable | Favorable |
For CICT, DPU disclosed are as follows:
- First Half of FY2025: SGD0.0562 per unit
- Second Half of FY2024: SGD0.0545 per unit
DPU for the first half of FY2025 has increased by 3.1% to SGD0.0562 per unit from SGD0.0545 per unit for the second half of FY2024. Management has disclosed that the higher distribution is largely due to the six-month contribution from ION Orchard, as well as better performance from existing properties and lower interest expenses on the back of lower gearing and easing interest rate environment. The metric is Favorable.
Occupancy
| Metrics | Current | Previous |
|---|---|---|
| Occupancy | 96.3% | 96.4% |
| Rating | Favorable | Favorable |
Occupancy rate as of 30 June 2025 has remained relatively unchanged at 96.3%. The metric remains Favorable as it is above my expected healthy occupancy rate of 95%.
Gearing ratio
| Metrics | Current | Previous |
|---|---|---|
| Gearing Ratio | 37.9% | 38.7% |
| Rating | Favorable | Neutral |
Gearing ratio as of 30 June 2025 has decreased to 37.9%. The metric shifted towards Favorable as it is now further away from my threshold of 40.0%.
Interest coverage
| Metrics | Current | Previous |
|---|---|---|
| Interest Coverage | 3.3x | 3.2x |
| Rating | Favorable | Favorable |
The interest coverage as of 30 June 2025 has improved slightly to 3.3 times. Management has disclosed that the average cost of debt is lower with the easing of interest rates. The metric remains Favorable as the interest coverage is above my preference of 3.0 times. The Group did not issue any hybrid securities; therefore, the adjusted interest coverage is the same as interest coverage.
Debt maturity profile
| Metrics | Current | Previous |
|---|---|---|
| Debt Maturity Profile | 4.0 years | 4.2 years |
| Rating | Favorable | Favorable |
Weighted average term to maturity of their debt as of 30 June 2025 has shortened to 4.0 years. The metric remains Favorable as there is sufficient time to refinance their debts as they fall due. Do note that 13% of their debt are due to mature by the end of FY2026.
Price to Book Ratio
| Metrics | Current | Previous |
|---|---|---|
| Price to Book Ratio | 1.06 | 1.01 |
| Rating | Neutral | Favorable |
The Price to Book (“P/B”) ratio became more expensive at 1.06. This is computed using the closing share price of SGD2.26 on 28 August 2025 and the net asset value per share of SGD2.13 as of 30 June 2025. The metric shifted towards Neutral as investors are paying a small premium for its book value.
As of 28 August 2025, the Market Capitalization is approximately SGD17,179 million.
Website: Yahoo Finance: CapitaLand Integrated Commercial Trust (C38U.SI)
Dividend
| Year | Yield | Total |
|---|---|---|
| 2025 | 4.54% | SGD 0.103 |
| 2024 | 5.77% | SGD 0.130 |
| 2023 | 4.72% | SGD 0.107 |
| 2022 | 2.47% | SGD 0.056 |
| 2021 | 5.21% | SGD 0.118 |
| 2020 | 2.70% | SGD 0.061 |
With the rights issuance in September 2024, CICT have given an additional distribution of SGD0.0216 per share for the existing holders in October 2024. Therefore, the amount to be paid out in March 2025 is not the full amount for the first half of FY2025. Do note as well that there is a private placement in August 2025, which resulted in the recent distribution to cover a period up to 13 August 2025.
For a conservative estimate, I will continue to use the dividend paid out for the calendar year 2024 from operations, which amounts to SGD0.1084 per share.
With a closing share price of SGD2.26 on 28 August 2025, this translates to a dividend yield of 4.80%. For my benchmark, a general reasonable yield would be around 4.75%. CICT’s dividend yield is slightly above my benchmark and remains Neutral.
Website: Reasonable Dividend Yield 2025Q3 – 4.75%
If using dividend yield of 5.75% as a benchmark, based on the dividend of SGD0.1084 per share there is potential for CICT to see its share price drop by another 16.6% to SGD1.89. This may occur should the interest rates and yield of safe assets increase.
| Yield | Share Price | Downside |
|---|---|---|
| Current | 2.26 | – |
| 5.75% | 1.89 | -16.6% |
| 6.75% | 1.61 | -28.9% |
Interest Rate Sensitivity
The Federal Reserve Chair Jerome Powell on 22 August 2025 gave a tepid indication of possible interest rate cuts ahead as he noted a high level of uncertainty that is making the job difficult for monetary policymakers. While he noted that the labor market remains in good shape and the economy has shown “resilience,” he said downside dangers are rising. At the same time, he said tariffs are causing risks that inflation could rise again — a stagflation scenario that the Federal Reserve needs to avoid.
Website: Powell indicates conditions ‘may warrant’ interest rate cuts as Fed proceeds ‘carefully’
The Federal Reserve on 31 July 2025 have left its key short-term interest rate unchanged for the fifth time this year, at a range of 4.25% to 4.50%. Powell also signaled that it could take months for the Fed to determine whether Trump’s sweeping tariffs will push up inflation temporarily or lead to a more persistent bout of higher prices. His comments suggest that a rate cut in September, which had been expected by some economists and investors, is now less likely.
Website: Fed’s Powell sticks with patient approach to rate cuts, brushing off Trump’s demands
CICT have provided the interest rate sensitivity analysis as below. Should the interest rate change by 1.0%, using FY2024 DPU of 10.88 cents as a base, DPU is expected to change by 2.1%.
| Change in Interest Rates | Change in DPU (cents) | Change as % of FY2024 DPU |
|---|---|---|
| 50 bps | 0.12 | 1.1% |
| 100 bps | 0.23 | 2.1% |
| 150 bps | 0.35 | 3.2% |
| 200 bps | 0.46 | 4.2% |
Other Metrics
Tenant profile
CICT has a well-diversified tenant profile with the top 10 tenants contributing to 16.9% of their total gross rent with no single tenant accounting for more than 4.8% during the period, providing income diversity to the portfolio.
Heartland Living
The Singapore government intend for every town to have a shopping mall available and successful. Such that they are willing to have measures to help support heartland businesses financially. This means that as an investor of retail properties, you can be assured that there will almost always be tenants for your shopping malls, which translates to rental income. It may still be subjected to capital depreciation and appreciation when exposed to economic conditions, such as the current high interest rates. However as of now, your interests are in line with the government.
Website: The Bull Case For Investing In Singapore Retail Property
Summary
| Metrics | Financials | Rating |
|---|---|---|
| Distribution Per Unit | +3.1% | Favorable |
| Occupancy | 96.3% | Favorable |
| Gearing Ratio | 37.9% | Favorable |
| Interest Coverage | 3.3x | Favorable |
| Debt Maturity Profile | 4.0 years | Favorable |
| Price to Book Ratio | 1.06 | Neutral |
| Overall | Favorable |
While there are changes to the metrics classification in the respective section, the overall metrics remain Favorable to invest in CICT. The financial position has improved this quarter, and together with the lower interest rates, has resulted in the share price of CICT to be more expensive.
Background
CICT is the first and largest real estate investment trust (“REIT”) listed on Singapore Exchange Securities Trading Limited (“SGX ST”). It made its debut on SGX ST as CapitaLand Mall Trust (“CMT”) in July 2002 and was renamed CICT in November 2020 following the merger with CapitaLand Commercial Trust (“CCT”).
CICT owns and invests in quality income producing assets primarily used for commercial (including retail and/or office) purpose, located predominantly in Singapore.
CICT is managed by CapitaLand Integrated Commercial Trust Management Limited, a wholly owned subsidiary of CapitaLand Investment Limited (“CLI”), a leading global real estate investment manager with a strong Asia foothold.
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Website: CapitaLand Integrated Commercial Trust (SGX: C38U): 2025 First Quarter Business Update
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