MORNING CALL: 14/9/23

RHB Research is “very upbeat” with Sunway’s successful tender of a new piece of land at Tengah Plantation Close in Singapore.

Transcript

00:00 RHB research is very upbeat with Sunway's successful tender of a new piece of land at

00:06 Tengah Plantation Close in Singapore.

00:09 The research house says the stock is still a buy, keeping its target price unchanged

00:13 at RM2.65.

00:15 The counter ended trading yesterday at RM1.93.

00:18 RHB points out that the 16,441 square metre land parcel on which an executive condominium

00:25 will be developed is near the proposed HSR station at Jurong East.

00:30 Citing its Singapore property analyst Vijay Natarajan, RHB says the demand, especially

00:35 for executive condominiums, is typically strong in the area, and the average selling price

00:40 is likely to be SGD1,450 per square foot.

00:45 Therefore, given the maximum gross floor area of 46,036 square metres, the research house

00:51 estimates gross domestic value would be around SGD719 million or RM2.47 billion.

00:59 The group has depleted all of its land parcels in Singapore, so it's the right time to

01:04 replenish its land bank there.

01:06 Historically, RHB notes, Sunway has done well in almost all of its Singapore projects, which

01:11 have been a big contributor to total annual sales.

01:15 And seeing where the plot is located, the group is now not only anchoring its presence

01:19 at Iskandar Putri, but also making a small but strategic presence on the Singapore side.

01:25 Quick look now at consensus.

01:26 According to Borsa Marketplace data, there are nine buy recommendations and two hold.

01:31 Average target price, RM2.31.

01:34 Sunway lost trader at RM1.93, so that's a potential return of almost 20%.

01:40 [music]