Actual vs. Expectations 9M12 net profit of RM175.2m was within
street but slightly above our expectations, making up 79% and 83% of street and
our FY12E earnings. Results were above ours as billings were more aggressive
than ours.
Dividends None as expected.
Key Results Highlights YoY, 9M12 earnings increased 37% given
strong sales and billings (Kinrara Residence, Garden Residence, M-Suites,
M-City, townships, i-Parc projects, etc.). Property operating margins remained
stable at 20%. However, group’s pretax margins expanded by 2ppt to 18% due to higher
other operating income from Southgate/Icon@Jln Tun Razak rental and higher interest
income.
QoQ, 3Q12 pretax profit declined 8% to RM76.1m as last
quarter saw closing of certain project accounts resulting in higher revenue.
9M12 sales of RM2.19b are on schedule to meeting FY12E sales
targets. Major new launches in 3Q12 were Garden Residence 2, Sutera Avenue and
Southbay City; these projects have achieved about 70%-75% take-up rates. We
understand there was an en bloc sale included in 3Q12 although the project or quantum
was not revealed.
Outlook Acquisition
of 412.4ac in Bandar Baru Bangi is still pending Estate Land Board approval,
which will likely be in 1Q13. In the meantime, MAHSING is looking for more
sizeable landbanks for FY13 and will strive to structure more progressive land payments.
Change to Forecasts Increasing FY12E earnings by 4% but
lowering FY13E earnings by 2%. We brought forward some of FY13E billings to
FY12E for on-going projects like Kinrara Residence and Icon City as it was more
aggressive than anticipated. Unbilled sales are extremely healthy at RM2.95b
providing 1.5-2 years visibility.
In line with sector call.
Valuation FD SoP RNAV increases by 3% to RM3.50
due to revisions in certain project’s GDV (refer overleaf). Consequently, we
raise our TP to RM2.45 when assuming unchanged RNAV discount of 30%.
Risks Unable
to meet sales targets. Sector risks, including negative policies.
Source: Kenanga
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