On 3 February 2023, CapitaLand China Trust (“CLCT”) have announced their full year result for FY2022. The results have shown slight deteriorations, with increasing financing costs which in turn lead to a fall in DPU and interest coverage, arising from their high gearing.

There was also a temporary shock when noting that NAV has decreased in 31 December 2022. Close examination shows however that it is mainly due to foreign exchange risk, which is not unexpected as RMB have depreciated against SGD in the last 1 year. This may reverse in 2023, as China have lifted their restrictions allowing the China economy to resume operations and demand for RMB may increase. I am looking forward to see the re-bound of businesses in China in 2023.

The share price have continued to trade at a significant discount from its net asset value. This comes with little surprise due to the