CapitaMall Trust pins its hopes on grocery shoppers as retail headwinds escalate

Non-discretionary spending will drive growth.

Grocery shoppers will keep CapitaMall Trust afloat as Singapore’s retail outlook dims, according to a report by OCBC.

OCBC said that approximately 74.5% of CMT’s existing portfolio by gross revenue is derived from non-discretionary spending. This will allow the group to weather the challenges which are currently plaguing Singapore’s retail sector.

CMT’s exposure to non-discretionary shopping will further rise to 76.2% once it finishes its acquisition of Bedok Mall.

OCBC also noted that CMT’s recent share price crash is unjustified and has driven the stock’s valuation to an attractive level.

“We believe value has emerged following its sharp share price correction. Besides positives from CMT’s current valuation, we believe management’s strong track record and CMT’s focus on necessity spending will allow it to better weather the challenges,” OCBC said.