Hanging out at a CapitaLand mall is the quintessential Singaporean past-time. CapitaLand is behind some of Singapore’s most recognisable malls, including ION Orchard, Plaza Singapura, Jewel Changi Airport and Bugis Junction, as well as prominent heartland malls like JCube, Westgate and Junction 8.
The company has developed and currently owns over 80 malls not just in Singapore, but also in China, Japan, Malaysia and Cambodia.
But both real estate and retail have taken a huge beating thanks to Covid-19. In Singapore, these shopping malls are as good as closed: Essential services and goods providers like supermarkets and pharmacies remain open, but the other than that, it’s a ghost town.
What does this mean for CapitaLand and CapitaMall stocks?
Disclaimer: This article contains information on CapitaLand and CapitaMall share prices as well as the company’s recent performance trends. It is meant as a guide for readers only, not financial advice. Please practise your own discretion when making investment decisions.
CapitaLand (C31) and CapitaMall Trust (C38U) overview
|Capitaland (C31)||CapitaMall Trust (C38U)|
|Sector||Real estate, real estate development & operations||Real estate, commercial REITs|
|Year of incorporation||1989||2001|
|Total Market Cap||$14,999.01 million||$6,273.26 million|
|Historical share price||Over $3.50 or most of 2019 before falling sharply to under $3 due to Covid-19||Steady growth over the past 4 years, over $2.25 for all of the past year before falling sharply to under $1.90 due to Covid-19|
|Current share price||$2.98||$1.81|
|Current dividend yield||4.03%||5.844%|
|Dividend yield 5-year average||3.282||4.437%|
Note: The figures are accurate at the time of writing (Apr 2020), but due to the nature of this industry, this information changes very frequently. For the latest updates, do check the CapitaLand (C31) and CapitaMall Trust (C38U) SGX listings.
CapitaLand and CapitaMall Trust stock profile: Share prices, dividends and more
With a hefty market capitalisation of about $15 billion, CapitaLand is one of Singapore’s biggest real estate giants and is tracked on the Straits Times Index.
The company has had a turbulent few years, with stock prices tumbling sharply in August 2015 only to rise again just as sharply in January 2017. After another tumble in the second half of 2018, stock prices started to see steady growth throughout 2019, although not without some dramatic fluctuations. Share prices reached a peak of $3.94 in January 2020 before tumbling sharply in March due to Covid-19, reaching a low of $2.57.
At present, they are still below the $3 mark.
CapitaMall Trust (C38U)
CapitaMall Trust, which is a real estate investment trust (REIT) in charge of 15 of the group’s shopping malls in Singapore, has a market capitalisation of over $6 billion. CapitaMall Trust is featured on the SGX Real Estate Index, MSCI Singapore Index, GPR REIT Singapore Index and the FTSE REIT Index, amongst others.
From 2017 to mid-2019, CapitaMall Trust share prices rose steadily, reaching a peak of $2.984 in July and mostly remaining above $2.50 until a dramatic fall due to Covid-19, reaching a low of $1.52 in April.
Both stocks pay out decent dividends. However, CapitaLand’s heaviest exposure is in Singapore and China, so dividends might take a hit depending on how severely Covid-19 affects these two economies.
CapitaMall’s dividend yield of 5.844% is even better than CapitaLand’s 4.03%, perhaps a reflection of the money-making potential of the group’s shopping malls, all of which are located near MRT stations and major transport nodes.
However, with shopping malls being badly hit by Covid-19 and the possibility of tenants defaulting, CapitaMall’s dividends might take a hit.
About Capitaland and CapitaMall Trust: Market news and updates
CapitaLand is a Singaporean real estate giant with a market capitalisation of about $15 billion. Incorporated in 1989, the company is in the business of developing and operating real estate.
While the company is best known for its malls, it actually has a diversified portfolio spanning many sectors, including commercial, retail, industrial and logistics, residential and business park. The company has properties mainly in Singapore and China, but has also expanded to countries like India, Vietnam, Australia and the US.
CapitaLand Mall Trust, or CapitaMall Trust, incorporated in 2001, is Singapore’s first SGX-listed REIT, and also its biggest, with a market capitalisation of over $6 billion. CapitaMall Trust’s portfolio consists of thousands of shopping mall leases with retailers in Singapore and abroad.
CapitaLand’s majority shareholder is Temasek Holdings, Singapore’s sovereign wealth fund, with 50.02% of shares. Temasek Holdings is also CapitaMall Trust’s biggest shareholder, with 30.02% of shares.
CapitaLand shareholders have already had quite a bumpy ride over the past few years, and the challenges posed by Covid-19 could make the cracks in its armour even more apparent. The economic fallout in both Singapore and China is likely to make CapitaLand share prices’s recovery a long and arduous road.
CapitaMall Trust’s exposure is mostly local, but likewise faces challenges, as its portfolio consists almost entirely of shopping malls. Shopping malls have already been facing intense disruption from online shopping and a fall in diversity of tenants due to high rents.
Now, Covid-19 has drastically reduced footfall in malls, and has had the company giving out rental rebates to tenants, which could in turn reduce dividends. The fate of CapitaMall Trust’s share price is thus intimately tied to how well Singapore manages to contain the epidemic and how soon commercial activity can resume.
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