Commercial & Industrial Property News Update

Malaysia - Mah Sing Group To Breach RM 200 Million-mark In FY 2012

August 10, 2012

Estimates by AmResearch indicate that Mah Sing Group Bhd's earnings will rise to RM 209 million in financial year 2012.

Leading Malaysian developer Mah Sing Group is forecast to turn in a strong report card for FY 2012, said AmResearch, whose estimates indicate that earnings for the group will reach RM 209 million this year, up from RM 169 million recorded in 2011.

Furthermore, the research house predicts that Mah Sing's strong performance will continue well into the next two years. It has put in estimated earnings of RM 260 million for FY 2013 and RM 320 million for FY 2014.

AmResearch's estimation is based in a three-year earnings compound 24% annual growth rate, anchored by in-demand landed residential developments.

"The group's earnings are very much secured with current RM 2.5 billion unbilled sales," it said, adding that annual pre-sales are expected to rise to RM 3.5 billion in FY 2013 and to hit RM 4 billion in FY 2014.

"The net gearing is expected to rise to 0.5 with one or two more land acquisitions by year end, but this is still within a comfortable level and should be pared down by its solid cashflows," AmResearch said in its research note.

It also noted that with Mah Sing's 40% dividend payout policy, the Group is expected to pay 11 sen to 15 sen dividend per share for FY 2012 till FY 2014. This translates to yields of 4% to 6%, on par with market norms.

The research house has put a "buy" rating, with RM 3.60 fair value for the initiating coverage on Mah Sing based on a mid-cycle discount to its estimated RM 4.80 per share net asset value.

Tags: Investment properties, Income properties

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