Resilient REIT Limited

Analyst thesis

Our recommendation is based on:

• Asset quality supports resilient rental income: Resilient REIT Limited’s (RES) dominant retail centres, anchored by grocery retailers and leading national brands, support strong tenant demand and low vacancies. The portfolio remains exposed to consumer spending and retailer trading performance, particularly in a weaker macroeconomic environment.

• Earnings growth is being driven by stronger property fundamentals: Positive leasing, low vacancies and active tenant management support rental growth and net property income (NPI).

• Energy investment, development, and acquisitions provide additional growth and margin support. Investing in solar and battery solutions reduces the exposure to administered electricity cost increases, with capacity expected to reach 94.4-megawatt peak, supplying about 43% of the group’s electricity requirements.

• Valuation is the key constraint: With the share trading close to its net asset value (NAV), much of the expected operational strength appears reflected in the current price.

• RES owns 40% of Retail Property Investments (RPI) in France, 50% of Spanish Retail Investments (SRI) in Spain, and 27.3% of Lighthouse. Lighthouse contributed R184.3 million to RES’s 1H26 distributable earnings, representing about one-fifth of the R919.3 million total. The offshore exposure through RPI, SRI and Lighthouse diversifies RES’s earnings base and reduces reliance on South African (SA) retail.