To The Moon

‌Technical Analysis (TA): The "Rising Wedge" Dilemma

$Keppel DC Reit(AJBU.SI)$

‌The chart highlights a Rising Wedge pattern, a classic technical formation that often signals a potential trend reversal or consolidation.‌

1. Pattern & Price Action

• ‌The Wedge: Price is currently trading within converging upward trendlines. While it looks bullish because it's making higher highs and higher lows, a rising wedge is traditionally a bearish reversal pattern in a mature uptrend.

• Key Resistance: The upper boundary of the wedge sits around $2.50 – $2.55. Price recently touched $2.38 (as of April 23, 2026), showing some resistance as it nears the upper rail.

• Immediate Support: Watch the lower trendline, currently around $2.25. A breakdown below this line with high volume could trigger a sell-off toward the $2.10–$2.15 zone.

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2. Moving Averages (MA Cross)

The chart shows a cluster of moving averages (20, 50, and 200-day).

• Bullish Alignment: The shorter-term averages (pink/blue) are trending above the long-term green line (likely the 200-day MA), which is currently at $2.28. As long as the price stays above this "Golden Zone," the medium-term trend remains healthy.

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3. Momentum Indicators‌

• RSI: Recent data suggests the RSI is hovering near 70, indicating the stock is approaching "overbought" territory. Expect some "mean reversion" or sideways consolidation soon.

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Fundamental Analysis (FA): Stellar 1Q26 Performance

‌While the technicals suggest caution due to the wedge pattern, the fundamentals are currently exceptionally strong.

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1. 1Q2026 Financial Highlights

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  DPU Growth: Distribution Per Unit (DPU) for 1Q26 grew by 13.2% YoY to 2.833 cents. This beat most analyst expectations.

• Rental Reversions: The standout metric is a +50.3% rental reversion. This indicates massive demand for data center space, allowing the REIT to hike rents significantly as old leases expire.

• Occupancy: Remains robust at 95.6%, underpinned by long-term leases (WALE of 6.5 years).

2. Balance Sheet & Valuation‌

• Gearing: Healthy at 35.1%, well below the regulatory limit, providing room for further acquisitions.

• Cost of Debt: Dropped to 2.6% (down 20bps), which is impressive in the current interest rate environment.

• Yield: At the current price of $2.38, the forward dividend yield is approximately 4.4% – 4.8%.

3. Risks & Catalysts‌

• Catalysts: Potential tax transparency for SGP 7 & 8 and the possible recovery of rent arrears from Bluesea (China) could provide further DPU upside.

• Risks: Geopolitical tensions in the Middle East affecting energy costs (though the manager notes electricity is <3% of OPEX due to hedging).

Kenny Loh is a distinguished MAS Private Wealth Advisor (RNF: LKK300389588) representing Financial Alliance with a specialization in holistic investment planning and estate management. He excels in assisting clients to grow their investment capital and establish passive income streams for retirement. Kenny also facilitates tax-efficient portfolio transfers to beneficiaries, ensuring tax-efficient capital appreciation through risk mitigation approaches and optimized wealth transfer through strategic asset structuring.

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