Cambridge Industrial Trust

Still Attractive

30 January 2008

CIT reported its FY07 results that were largely in-line with our projections,

backed by properties acquired during the past year. Gross revenue came in at

S$53 million and net property income is S$45.8 million. CIT achieved a full year

DPU of 6.262 cents. Net asset value increased from $0.67 to $0.76.

Results in-line with our estimates.

S$52.3 million, net property income of S$45.8 million versus our forecast of S$45.9

million. Full year DPU is higher by 4% than our forecast of 6.02 cents.Revenue came in within 1.5% of our forecast of

Revenue growth backed by accretive acquisitions.

from 27 properties with an asset value of S$531 million to 40 properties worth S$928

million at year-end with the acquisition of 13 properties during the year. In January

this year, CIT managed to seal another 2 deals and has signed $125.6 million worth

of MOU.CIT expanded its portfolio

Capital management strategy.

their capital management plan for the year. Since the successful equity fund raising

in October last year, CIT gearing has lowered to 36% and it has $131 million in undrawn

facility available. Management intends to take advantage of the low interest

rate environment so as to lock in the low rate whenever possible. In the longer term,

management intends to refinance through CMBS issues.During the results briefing, management laid out

Plans ahead.

locally or venturing overseas and reiterates its target of S$500 million worth of

acquisition p.a.Management remains confident on growing via acquisition whether

Valuation and recommendation.

for REIT to pursue growth via acquisition as the cost of equity increases. On

hindsight, CIT managed to raised S$193.9 million and completed 7 acquisitions just

before market sentiment turns awry. With gearing at 36% and $131 million in

available credit facility, CIT has no worries about funding in the short term. We

maintain our favourable stance on CIT. Our optimism in CIT stems from the stable

underlying cash flow and DPU growth from potential accretive acquisitions. Fair value

is lowered from $1.07 to $0.89 as we raised our assumptions for beta and risk

premium to reflect volatile market condition and factor in conservatism.The current market conditions may prove difficult