STOCK FOCUS OF THE DAY
Titijaya Land : Making its move into prime KLCC
developments BUY
We maintain BUY on Titijaya Land with an unchanged fair
value of RM3.30/share - pegged at a 25% discount to its NAV/share of RM4.40.
Titijaya announced that its wholly-owned unit Titijaya Resources Sdn Bhd has
entered into an agreement to raise its stake in Tenang Sempurna Sdn Bhd (TSSB)
to 70% for RM70k. TSSB had on 10 July 2014, received a provisional award for a
joint-development agreement on a piece of land under Lot 282, Section 63, KL.
From our channel checks, we understand that the said land sits on a ~5-acre
plot located along Jln. Eaton and opposite Suria Stonor.
Based on our initial estimates, we expect this deal to lift
Titijaya's fair value by ~8% or RM0.30/share to RM3.60/share, and bump up its
GDV closer to RM10bil from ~RM7bil currently. Our key assumptions are: (I) ave.
selling price of RM2,000 psf; (ii) plot ratio of 8x; (iii) efficiency ratio at
75%; (v) net usable area of ~1.2 mil sq ft; and (iv) development period of 8
years.
We leave our estimates unchanged for now pending a formal
endorsement from the relevant authorities. The proposed development will likely
be well received, given its strategic importance as one of the last few
sizeable tracts of land remaining within KL's 'golden triangle'. Our channel
checks indicate that the average prices for residential units at the Four
Seasons Place Kuala Lumpur is ~RM2,800psf. The group may rope in a global hotel
operator to brand its hotel block.
Titijaya still has more legs to go given the increasingly
robust land banking and pre-sales momentum. Titijaya is set to deliver
c.RM95mil in FY15F (ending 30 June) vs. c.RM68mil for FY14F, before rising
further to RM123mil in FY16F. This translates into a solid-three year earnings
CAGR of 30% with attractive FY14F-16F FD PEs of 8x-14x.
Others :
Magnum : Yield story HOLD
QUICK TAKE
TSH Resources : Loses one, gains one
SELL
NEWS HIGHLIGHTS
MSM Malaysia Holdings : Looks beyond refining into
international raw sugar trading
Media Prima : Big Tree goes all out to boost advertising
revenue
AirAsia : Wins world’s best low-cost airline for 6th time
Malaysia Airports Holdings : Warehouse role for former LCCT
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.