Lippo Malls REIT (LMIR)

[Nick]

S$ 147.5 million loan facility to mature in June 2014.
S$ 200 million 4.88% fixed rate note (EMTN Program) to mature in July 2015
S$ 50 million 5.875% fixed rate note (EMTN Program) to mature in July 2017
S$ 75 million 4.48% fixed rate note (EMTN Program) to mature in Nov 2017

http://infopub.sgx.com/FileOpen/2013_2Q_...eID=250487 [Slide 14]

Unless I am mistaken, doesn't this means the debt (especially the fixed rate notes) are priced in SGD ? This would imply debt and interest expenses are in SGD while its operating revenue and property valuation are in IDR. If IDR continues to depreciate against the SGD, a larger portion of the revenue will be diverted to pay the interest and the lower property valuation will result in higher gearing. Granted, the Management would have probably hedged forex movements in the short term but nonetheless I guess this is why the market is selling it down ?

(Not Vested)

Is the market trying to price in a currency crisis? A 15% drop in rupiah against SGD willl only cause a 5% dent in income distributable to unitholders, correction excessive IMO. Assume a 10% fall in DPU to account for interest rate(2percent increase lead to only about 3million increase in Finance cost) and currency weakness, unitholders should be look at 3.2 cents dividends, and at 40 cents per unit, its still a attractive 8% yield

(vested and accumulating)

Just curious - why is this so ? Is this due to the hedging ?