[Click eStock] "Iritsukokureb, Target Price Lowered by 8%"

NH Investment & Securities lowered the target price of IREITs Core REIT to 4,800 KRW on the 23rd, a decrease of 8%. The target price downgrade was due to the reflection of the refinancing interest rate confirmed in May. The investment rating was maintained at 'Neutral.'

In May of this year, the entire 430 billion KRW of borrowings and bonds matured. The average borrowing rate at the time of procurement three years ago was 3%. The previously estimated refinancing rate was 5.2%, but it was actually confirmed at around 5.4%. However, 280 billion KRW out of the 430 billion KRW was procured at a variable interest rate, and it is expected that the interest rate will be adjusted downward quarterly.

After the completion of consultations related to the change of entrusted management REITs approval in September 2022, restrictions on asset inclusion were lifted. However, there has been no concrete plan for new asset inclusion over the past two years. Eun-Sang Lee, a researcher at NH Investment & Securities, said, "The assets are composed only of retail stores, most of which are aging with an average of 26 years since opening," adding, "To maintain the competitiveness of the REIT, it is necessary to include assets from various sectors beyond just retail."

It was anticipated that dividend erosion due to increased financial costs following refinancing would be inevitable. Based on the target price and current stock price, the expected dividend yield for 2025 was analyzed to be approximately 5.8% and 5.0%, respectively. It was judged that the dividend attractiveness is not high compared to other companies.

This content was produced with the assistance of AI translation services.