STOCK FOCUS OF THE DAY
Titijaya Land : Forging ahead on solid footing BUY
We initiate our coverage on Titijaya with a BUY call and a fair value of RM2.01 per share, based on a 30% discount to its revalued net asset value (RNAV). Currently, its ongoing projects include H2O @ Ara Damansara (mixed development), Emery @ Kemensah (high-end landed residential) in Ampang, Mutiara Residences in Klang (landed residential) and Seri Alam Residence in Klang (landed residential). Titijaya is launching new developments with RM1.82bil GDV in FY18 — The Shore @ Kota Kinabalu (mixed development), 3rdNvenue @ Jalan Ampang (mixed development), Riveria KL Sentral (mixed development), Damansara West, Bukit Subang (township), and Park Residensi @ Cheras (landed residential).
Titijaya’s revenue growth has been strong, with a FY13-FY16 3-year CAGR of 29.0%. Although we expect revenue growth to be negative in FY17 consistent with the challenging industry condition, we expect a rebound from FY18 onwards, supported by a slew of new launches in FY18 and beyond. Its earnings growth has also been commendable, with its FY13-FY16 3-year net profit CAGR standing at 7.1%, despite its net profit margin dropping to 17.1% in FY16 compared to 23.8% in FY15, which we believe was due to the challenging industry environment.
Others :
Bumi Armada : Boost from Lukoil extension contract HOLD
Pos Malaysia : Acquiring vessels for TNB contract HOLD
QUICK TAKES
Plantation Sector : India increases import duties on vegetable oils NEUTRAL
Plantation Sector : News flow for week 7 – 11 August NEUTRAL
STOCKS ON RADAR
My E.G. Services, Heveaboard, Petron M’sia Refining & Marketing, Samchem Hldgs
NEWS HIGHLIGHTS
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