Stock Name: UMLAND
Company Name: UNITED MALAYAN LAND BHD
Research House: CIMB
United Malayan Land Bhd
(May 31, RM1.91)
Maintain buy at RM1.88 with revised target price of RM2.53 (from RM2.11): UM Land's 1Q11 net profit was broadly in line at 27% of our full-year forecast. Future quarters may not be as strong, depending on the timing of the Puteri Harbour launch and the response to it. We make no changes to our earnings forecasts or 'buy' recommendation but raise our target price from RM2.11 to RM2.53 after lowering the discount to its RM4.22 realisable net asset value from 50% to 40%. The lower discount factors in the likely improvement in liquidity after the proposed one-for-four bonus issue as well as the group's improving earnings prospects. Potential share price catalysts include: (i) the buoyant property market; (ii) more land acquisitions; and (iii) strong sales for new condo projects.
Annualised 1Q net profit made up 108% of our full-year forecast. Net profit for 1Q jumped 61% year-on-year (y-o-y) due to a marked improvement in sales for the Suasana Bukit Ceylon condo project. As expected, and in line with last year, UM Land did not propose a 1Q dividend. The proposed one-for-four bonus issue will go ex in August.
Sales in 1Q rose 6% quarter-on-quarter and 56% y-o-y to RM134 million, of which 28% came from townships and 72% from niche developments. The bulk of the sales came from the Suasana Bukit Ceylon condo where the take-up rate has improved from 17% worth RM47 million to 48% worth RM146 million. As at mid-May, the take-up had risen further to 56% worth RM166 million, excluding bookings for another 30 units worth RM46 million. Sales in 1Q exceeded UM Land's internal target by RM15 million.
The group is targeting to launch RM495 million worth of properties in 2011, including the RM189 million condo scheme Puteri Harbour in Johor. The retail component worth RM46 million was sold to Khazanah Nasional Bhd in February. The launch date for the condos, however, appears to have been pushed back yet again. Originally targeted for launch at end-2010, it was delayed to 1Q11, then to 2Q11 and now to 3Q11. Preliminary indications are that the pricing for the condos will average RM650 psf. ' CIMB Research, May 31
This article appeared in The Edge Financial Daily, June 1, 2011.
Company Name: UNITED MALAYAN LAND BHD
Research House: CIMB
United Malayan Land Bhd
(May 31, RM1.91)
Maintain buy at RM1.88 with revised target price of RM2.53 (from RM2.11): UM Land's 1Q11 net profit was broadly in line at 27% of our full-year forecast. Future quarters may not be as strong, depending on the timing of the Puteri Harbour launch and the response to it. We make no changes to our earnings forecasts or 'buy' recommendation but raise our target price from RM2.11 to RM2.53 after lowering the discount to its RM4.22 realisable net asset value from 50% to 40%. The lower discount factors in the likely improvement in liquidity after the proposed one-for-four bonus issue as well as the group's improving earnings prospects. Potential share price catalysts include: (i) the buoyant property market; (ii) more land acquisitions; and (iii) strong sales for new condo projects.
Annualised 1Q net profit made up 108% of our full-year forecast. Net profit for 1Q jumped 61% year-on-year (y-o-y) due to a marked improvement in sales for the Suasana Bukit Ceylon condo project. As expected, and in line with last year, UM Land did not propose a 1Q dividend. The proposed one-for-four bonus issue will go ex in August.
Sales in 1Q rose 6% quarter-on-quarter and 56% y-o-y to RM134 million, of which 28% came from townships and 72% from niche developments. The bulk of the sales came from the Suasana Bukit Ceylon condo where the take-up rate has improved from 17% worth RM47 million to 48% worth RM146 million. As at mid-May, the take-up had risen further to 56% worth RM166 million, excluding bookings for another 30 units worth RM46 million. Sales in 1Q exceeded UM Land's internal target by RM15 million.
The group is targeting to launch RM495 million worth of properties in 2011, including the RM189 million condo scheme Puteri Harbour in Johor. The retail component worth RM46 million was sold to Khazanah Nasional Bhd in February. The launch date for the condos, however, appears to have been pushed back yet again. Originally targeted for launch at end-2010, it was delayed to 1Q11, then to 2Q11 and now to 3Q11. Preliminary indications are that the pricing for the condos will average RM650 psf. ' CIMB Research, May 31
This article appeared in The Edge Financial Daily, June 1, 2011.
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