DCR reported earnings per share of PKR 3.60 in FY25 vs loss per share of PKR 3.66 in FY24. In 1QFY26, the EPS remained PKR 0.62 (1QFY25: 0.50). Average Rental Yield for Mall and Harbor Front is around 8%. Average Rent per Square Foot for all is PKR 650, and Harbor Front is around PKR 450.
Contractual annual rental increase is in the range of 10%. Management highlighted that more than 50% of the tenants have shifted to the revenue sharing model. Revenue sharing constitutes around 10% of the total rental collection. The model is not purely revenue sharing.
It is buffered by a base rent, with the revenue sharing element applied above the base rent. Management noted that tenants are highly transparent including multinationals or strong national organizations with POS implemented. Dolmen Mall Lahore’s REIT is planned to tentatively launch in 12-18 months. It will be a separate REIT not within DCR. Sky Tower A and B is not planned for IPO in the upcoming 12 months.
The addition of Sky Tower A, B, and the Executive Tower to DCR is not currently being considered. DCR does not currently have plans to acquire new properties to expand the existing portfolio. Key bottleneck stopping new REIT launches is the removal of the sunset clause in Section 99A, Second Schedule Part-I of the Income Tax Ordinance. Income from kiosks was reclassified from marketing income to rental income to better reflect its nature and for better presentation.
The REIT carries insurance coverage from the top three companies in Pakistan, including war and terrorism coverage. Management expects a growing dividend in coming years
Important Disclosures
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