First REIT has taken a battering recently, with its share price bouncing about like drunken town crier. The counter has been on my watch list for sometime, and I’ve been waiting for the opportunity – and the cash – to invest more into the counter as a long term play.
Of course, it’s been down-graded based on Flinch’s assessment of Lippo Karawaci, the main sponsor and tenant of First REITS properties. Now, this move gives First REIT’s investors cause for concern, but I think the crazed market sell off has been based on emotion rather than rationality. Also, compounding matters are recent allegations of its corruption case pertaining to the Meikarta Project. But even with this thrown into the mix, I still feel it’s been over sold.
For those interested in the stock keep the following in mind:
1. After the sell-off the REIT is now trading at at 1.0x price to book (previously investors