First Reit Rights Issue

Finally, the management has declare rights issue for First Reit in order to purchase two properties. I am no fundamental expert and I just took glimpse of their proposal.

Price at 0.50 is cheap, but a lot of rights is being declare, 5 for 4 to be exact. Recently, AIMS is at 7 for 20, which was their second rights. AIMS first rights was 2 for 1 due to the serious nature of their financial problem. First Reit has no issue with their finance. I really don't understand why they are doing this. Also one of the propose property is still under development. Personally, I don't like properties that are under development because of no past performance.

The presentation seemed ill-prepared. It did not clearly state how the income will accretive to current dividend and did not mentioned the gearing ratio after rights. They just give a figure on commencement rent for both property and future dividend yield which are just not enough info.

All in all, I'll continue to wait and see.

Steady Performance

I have been following First Reit for quite some time and I had never invest it because I don't want too much exposure in Indonesia since I have Lippo Maple and I also have Plife in the portfolio. But I think I made a grave mistake. Let's take a look of First Reit.

 
As we can see, it's performance is very steady and I should have invest it long ago. First Reit latest dividend is 1.92 cents and with share price of 0.87, it's annualized yield is 8.8%. And gearing is at 15%. First Reit fits my criteria so I'll buy it if share price falls to 0.85.