Will Frasers Centrepoint Trust Raise Its DPU for FY2025? (The Smart Investor)

Although I’ve been a shareholder of Frasers Centrepoint Trust (SGX: J69U), or FCT, for nearly a decade, I attended my first annual general meeting (AGM) on Tuesday.

FCT’s clear presentation and the readily available audio cast of their results briefing on the investor relations site meant that much of the information shared at the AGM was already familiar to me.

However, I still enjoyed the AGM it provided a valuable opportunity to be reminded of key developments, and to hear the opinions and questions of other shareholders.

Based on the information gathered, I shared my outlook on FCT for the current fiscal year (FY 2025) in the following article. The article explores the opportunities and challenges facing FCT and concludes with my suggestion on whether distribution per unit (DPU) for FY 2025 is likely to increase.

Click the image below to read the article.

Here are some additional points that emerged from the AGM, intertwined with my own opinions, which weren’t covered in the article:

Hougang Mall’s growth potential

Hougang Mall is poised to benefit from the upcoming Cross Island Line (CRL), with Hougang station serving as an interchange. While competition may intensify from a new mixed-use development above the station, the increased foot traffic generated by these developments should ultimately drive more sales for Hougang Mall tenants.

Resilience in the face of E-commerce

Online shopping in Singapore has experienced substantial growth, increasing its share of retail sales from 8% in 2019 to 16% currently. Despite this surge in online commerce, tenant sales from FCT’s retail portfolio still achieved a remarkable 20% growth during the same period.

The discussion about the impact of online shopping on physical stores is certainly not new – I recall these conversations starting more than a decade ago. However, the prevailing trend among most retailers is to embrace omnichannel strategies, indicating the continued relevance of physical stores.

No Immediate Plans for Overseas Expansion

For the time being, FCT has no plan to expand beyond Singapore. While there may eventually come a time when further expansion within Singapore becomes challenging, I believe this scenario is still some time away.

Currently, FCT still has ample opportunities to acquire retail assets and implement its successful asset enhancement initiatives (AEI) to continue growing.

I remain optimistic about FCT’s future performance. In fact, I recently repurchased the stake I sold last year. I look forward to the release of their 1Q 2025 business update next Wednesday.

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