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ATTACQ LIMITED

ATT JSE Listed
Market Cap
** ~R12.3 Billion (Based on share price ~R16.50).

Investment Analysis: Attacq Limited (JSE: ATT)

Date: 12 January 2026 Analyst: Gemini (Senior Equity Analyst)

Step 1: Data Gathering & Source Verification

Reporting Periods Used:

  • Annual Financial Statements (Year Ended 30 June 2025):

  • Source: Audited Financial Results June 2025

  • Interim Results: The interim results for the six months ended 31 December 2025 have not yet been released (expected March 2026). The analysis relies on the FY25 year-end data.

  • SENS Announcements (Last 12 Months):
  • Key Logs: JSE SENS Feed - Attacq

Recent Key SENS Activity:

  • 11 Dec 2025: Dealings in securities by directors (indicating insider sentiment).
  • 14 Nov 2025: Results of Annual General Meeting.
  • 16 Sep 2025: Dividend Declaration (Final Dividend of 43.0 cents per share).

Step 2: Metric Extraction

  • Market Cap: ~R12.3 Billion (Based on share price ~R16.50).
  • Dividend Yield (L12M): 5.27%.
  • Calculation: Interim (44.0c) + Final (43.0c) = 87.0c Total Dividend.

  • Context: 87.0c / 1650c ≈ 5.27%. The payout ratio is consistently ~80% of distributable income.

  • Liquidity Check: Moderate to High Liquidity.

  • Data: Average daily volume is approximately 250,000 – 600,000 shares.

  • Risk Assessment: Liquid enough for most retail and mid-sized institutional portfolios.

  • P/E Ratio: 13.2x (Based on Distributable Income per share of 108.3c, not IFRS earnings, as is standard for REITs).

  • Net Asset Value (NAV): R18.94 per share.
  • Discount to NAV: The stock is currently trading at a ~12.9% discount to its stated Net Asset Value (Price R16.50 vs NAV R18.94).

Step 3: Operational & Strategic Analysis

Business Overview: Attacq is a Real Estate Investment Trust (REIT) focused on "precincts." Its crown jewel is Waterfall City in Midrand (anchored by the Mall of Africa), which it controls and develops. Unlike traditional REITs that just hold buildings, Attacq is a developer-owner hybrid. It recently sold down a 30% stake in its Waterfall investment to the GEPF (Government Employees Pension Fund) to deleverage its balance sheet.

Performance Trend:

  • Expanding: The FY25 results were excellent. Distributable Income Per Share (DIPS) grew by 25.6% to 108.3 cents.
  • Balance Sheet Transformation: The GEPF transaction was a game-changer. Gearing (debt ratio) dropped significantly to ~25.3%, making Attacq one of the most defensively geared REITs on the JSE.
  • Operational Health: Occupancy remains high (~93%), and the "collaboration hubs" (office spaces) in Waterfall are outperforming the broader weak office market due to the "flight to quality" trend.

Sector Context (Macro Factor): Interest Rate Cycle: South African REITs are highly sensitive to interest rates. With the SARB (South African Reserve Bank) cutting rates in the current cycle (late 2025/early 2026), Attacq's cost of debt decreases directly, boosting distributable income. Furthermore, lower rates generally compress property yields, increasing the capital value of their portfolio.

Step 4: The Verdict

Bull Case (Buy Rationale): The Waterfall Premium: You are buying high-quality assets at a discount. Waterfall City is arguably the best mixed-use precinct in South Africa, attracting blue-chip tenants (Amazon, Cisco, PwC) even when the rest of the economy struggles. The low gearing (25%) means they have "dry powder" to develop new logistics or residential projects while competitors are struggling to service debt.

Bear Case (Sell Rationale): Valuation Ceiling: The stock has re-rated significantly over the last 18 months (up >20%). Much of the "GEPF deal success" is now priced in. If office vacancies in the broader Gauteng node worsen, even Waterfall might see rental growth slow down. The dividend yield of ~5.3% is lower than many other SA REITs (which offer 8-10%), meaning you are relying heavily on capital growth rather than income.

Fair Value Estimate: R18.50 – R19.50.

  • Rationale: The stock should trade closer to its NAV (R18.94) given the quality of the assets and the low debt risk. A small premium to NAV is justifiable for the development pipeline.

Final Rating: ACCUMULATE / BUY

  • Justification: Attacq has transformed from a debt-heavy developer into a fortress-balance-sheet REIT. While the yield is lower than peers, the growth profile (DIPS growth of 25% is rare in this sector) justifies the premium. The discount to NAV is an attractive entry point for long-term holders looking for quality over high-risk yield.
AI Generated Analysis Last Updated: 2026-01-14