Broker: UOB Kay Hian
Date of Report: 09 April 2026
Excerpt from UOB Kay Hian report.
Report Summary
- Stock: Keppel DC REIT (KDCREIT SP)
- Actionable Call: BUY (Maintained)
- Target Price: S\$2.82
- Current Price (at report): S\$2.29
- Upside: +23.1%
- Key Idea: Keppel DC REIT is anchored by the stability and resiliency of the Singapore data centre market, which accounts for 62.5% of its AUM. The REIT is focusing on acquiring hyperscale data centres in Singapore, Japan, South Korea, and Europe, with third-party acquisitions in the near term. Potential sponsor pipeline assets (SGP9 in Singapore, Western Tokyo DC) are likely to be stabilised only in 2028/29.
- Investment Highlights:
- Strong support from sponsor Keppel and focus on supply-constrained, high-demand markets.
- Colocation leases in Singapore expected to see positive rental reversions in 2026 and 2027.
- Conservative capital management with 71% of borrowings hedged to fixed rates and cost of debt guided lower at 2.7% for 2026.
- Implications: Investors should consider the REIT for its strong market position, stable yield, and visible growth pipeline, particularly in Singapore. The target price implies a potential upside of 23% from the current level.
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