October 12, 2010

SUNWAY - ECM Libra Research: Sunway remains top BUY for construction sector

Stock Name: SUNWAY
Company Name: SUNWAY HOLDINGS BHD
Research House: ECMLIBRA

KUALA LUMPUR: ECM Libra Research says SUNWAY HOLDINGS BHD [] remains its Top Buy for the CONSTRUCTION [] sector.

In its research report issued on Tuesday, Oct 12, it said this was based on the strong earnings growth of 67.6% in FY10; undemanding forward P/E valuation of 8.7 times; more landbank acquisition in the pipeline, and strength in securing overseas construction contracts.

'Our target price, which is based on 10 times P/E on mid FY11 EPS, remains unchanged at RM2.61 as impact on FY11 earnings is negligible.

'This is further supported by sum-of-parts valuation of RM3.12, which has been revised from RM3.14 previously,' it said.

On Monday, Sunway announced that its unit, SunwayMas Sdn Bhd had terminated the joint venture agreement with Monty PROPERTIES [] Sdn Bhd to undertake a property development project known as Puncak Jalil with a gross development value of RM120 million.


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