DBS Vickers initiated coverage of Religare Health Trust
with a 'buy' rating and a target price of S$0.97,
citing an attractive dividend yield and exposure to the
fast-growting Indian healthcare sector.
By 0402 GMT, Religare Health shares were up 3 percent at
S$0.82, but still 8.9 percent lower than the initial public
offer price of S$0.90. Religare Health made its market debut
The brokerage expects Religare Health, which has 17 assets
and is backed by India's healthcare services provider Fortis
Healthcare, to pay a distribution yield of around 10
percent at its current price, and is structured to offer upside
potential through variable fees.
As 96 percent of Religare Health's assets are operational,
distribution income can be sustained till 2014, providing
assurance that it will be able to meet DBS' distribution per
unit forecasts, it said in a report.
"Healthcare industry outlook in India looks promising," DBS
said, citing Frost and Sullivan's estimates that the market will
grow at an annual average rate of 15 percent from 2010-2015 on
the back of rising and aging population and growing affluence.
1205 (0405 GMT)