Broker: OCBC Group Research
Date of Report: 28 July 2026
Excerpt from OCBC Group Research report.
Report Summary
- Stock Focus: Keppel Infrastructure Trust (KIT SP EQUITY)
- Action: BUY (Reiterated)
- Target/Fair Value: SGD 0.575 (revised down from SGD 0.580)
- Last Closing Price: SGD 0.535
- Key Idea: KIT remains a resilient and defensive play for investors seeking exposure to infrastructure assets, supported by long-term contracts and cost pass-through mechanisms which insulate more than 90% of its portfolio from inflation. The trust is positioned to benefit from rising infrastructure spending and continues to pursue DPU-accretive acquisitions, leveraging the Keppel ecosystem.
- Highlights:
- 1H26 distribution per unit (DPU) grew 1% YoY to 1.99 Singapore cents, in line with expectations.
- Portfolio is resilient with limited Middle East conflict exposure.
- Net gearing increased to 44.2% due to capital drawdown for further asset acquisition; 76.7% of debt is fixed or hedged.
- Potential catalysts: DPU-accretive acquisitions, divestment of mature assets, and extension/renewal of concessions.
- Risks: Lower-than-expected asset availability, higher refinancing costs, regulatory risks.
- Implications: The yield remains attractive at about 7.4-7.5%, with forecasted DPU growth of 1% per year. The revised fair value reflects slightly higher debt costs but maintains a positive outlook for steady distributions.
Above is an excerpt from a report by OCBC Group Research. Clients of OCBC Group Research can access the full research report from the broker’s website.
