RZTR11 currently presents an attractive entry point at R$85.00, trading at a significant 12.3% discount to its NAV of R$96.93. At this price, investors can achieve a compelling yield on cost of 16.2% (based on the current monthly distribution of R$1.15).
The fund's core portfolio consists of 22 prime agricultural properties totaling 82,661 hectares, with a balanced investment strategy across Sale & Leaseback (51%), Buy to Lease (30%), and Land Equity (16%). The average lease rate of 15.24% on contracts with a 10-year average duration provides strong cash flow visibility.
Key value drivers include:
- Recurring income backed by established agribusiness tenants
- Potential NAV appreciation through Land Equity asset monetization
- Portfolio diversification across multiple Brazilian agricultural regions
- High liquidity with R$5.45M average daily trading volume
The current discount to NAV offers a margin of safety, while maintaining upside potential through both yield compression and asset appreciation as interest rates normalize.
Target Return Profile:
- Current Yield: 16.2% (YoC)
- Capital Appreciation Potential: 14.0% (convergence to NAV)
- Total Return Potential: ~30.2%
Primary risks include interest rate movements, commodity price fluctuations, and broader macroeconomic conditions affecting the agricultural sector.
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