Mapletree Industrial Trust Earnings: Occupancy Improves, but Units Overvalued

We maintain our SGD 2.30 per unit fair value estimate after Mapletree Industrial Trust reported in-line results for second-quarter fiscal 2025 (ending March). Net property income rose 4.6% year on year, driven by contributions from Osaka Data Center, which was acquired in September 2023, as well as new and renewed leases. These were partially offset by the nonrenewal of leases in its North American portfolio and the loss of contribution from the divestment of the Tanglin Halt Cluster. Our forecast is largely unchanged. While we continue to like the trust for its portfolio of data centers that benefits from strong secular growth trends, such as cloud computing, artificial intelligence, and other technological advancements, we think the units are currently overvalued and investors should wait for a better entry price.