Two initial public offerings (IPOs) got the investing town talking nowadays: one is a bond exchange traded fund (ETF) and the other a real estate investment trust (REIT), namely the LionGlobal Short Duration Bond Fund (Active ETF SGD Class) (LionGlobal Bond ETF) and the Centurion Accommodation REIT (Centurion REIT).
I will briefly go through these two IPOs and will give my very short take.
LionGlobal Bond ETF
The LionGlobal Bond ETF is an active bond ETF and is the listed version of an existing unit trust fund with the same name. It is an actively managed ETF that has a wide exposure of short-term duration bonds across various countries (primarily Singapore with about 40% of its net asset value or NAV) and sectors (76.5% NAV from financial and real estate). The weighted yield to maturity, duration and credit rating stood at 3.18%, 2.25 years and A-, respectively.
The main selling points of the ETF is the advent of falling interest rates, to which short duration bonds are less correlated to, and the stability of the Singapore Dollar (SGD) from which it would be hedged with against non-SGD bonds in the ETF.
The LionGlobal Bond ETF IPO application period is from now till 23 Sep 2025 and will be listed on 29 Sep 2025, with an issue price of SGD1.00 per unit.
Centurion REIT
In the first of its kind in Singapore, the upcoming Centurion REIT is focused on worker and student accommodation (hence the word in their official listing name), with 14 properties across three countries (Singapore – 5 worker dormitories, United Kingdom – 8 student dormitories and Australia – 2 student dormitories), and a possible one more student dormitory coming up in Australia. The sponsor, listed company Centurion Corporation, is a known player in the dormitory business.
Yield wise, the projected distribution for 2026 is 7.47% and 2027 is 8.11%. The gearing ratio is around 20.9% at IPO, increasing to 31% after the acquisition of the 15th property mentioned in the previous section. Though 262 million plus units are issued in the IPO, only 13.2 million units are available for public offering in Singapore.
Centurion REIT is now open for IPO application till 23 Sep 2025 and will be listed on 25 Sep 2025, with the issue price of SGD0.88 per unit.
The Bedokian’s Take
I would view the LionGlobal Bond ETF as a corporate bond since the bond issuers are mostly in the commercial side. For our Bedokian Portfolio, it sits somewhere in between the cash portion and bond component, since the maturity (2.25 years) is too short for a corporate bond (five years minimum based on guideline) and too long as a cash-equivalent (one year maximum). The 0.25% management fee for an actively managed ETF is reasonable relative to the Amova SGD Investment Grade Corporate Bond ETF (Amova IG Corporate Bond ETF) which is at 0.26%, and not actively managed.
The LionGlobal Bond unit trust version had provided a 3.7% per annum performance since its inception in 1991, which is impressive given its bond status. While as an ETF, the risks are somewhat distributed, the big one in my opinion would be a systemic risk affecting the entirety of the financial and real estate sectors, since 76.5% of the bonds are from them.
As for the Centurion REIT, with accommodation as its primary driver, the income deriving from workers and students would have to depend on which they are supporting, that is the construction/manufacturing sectors, and education sector respectively. According to the prospectus, the increasing demand for workers is there with Singapore’s ongoing development and expansion of infrastructure and industrial capabilities. For students, particularly international ones, the United Kingdom and Australia remained as one of the top three study destinations for them.
Both IPOs do have their unique propositions in terms of the potential; low correlation of short-term bonds to interest rates, and a REIT on dormitories. It would be a go for me though I find the Centurion REIT might be harder to get due to the small Singapore public offering numbers vis a vis the total number of units offered.
All figures are from the respective IPO and fund documentation unless otherwise stated.
Disclosure
The Bedokian is vested in the Amova IG Corporate Bond ETF.
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