Business News

Published: Friday March 8, 2013 MYT 12:00:00 AM
Updated: Thursday April 18, 2013 MYT 1:25:38 AM

Sunway an attractive proxy to Iskandar Malaysia

KUALA LUMPUR: Affin Investment Research has upgraded Sunway Bhd to a Buy with a higher target price as it is an attractive proxy to Iskandar Malaysia.

It said on Friday it upgraded Sunway to Buy from Add with a higher target price of RM3.28 from RM2.78 based on 30% discount to RNAV from the earlier 40%.

“We have narrowed our target price discount to RNAV as we expect the positive developments in Iskandar, recent re-rating of Iskandar-focused developers and potential listing of Iskandar Waterfront Holdings to re-rate its share price closer to RNAV,” it said.

Affin Research viewed Sunway as an attractive proxy to Iskandar Malaysia as it was trading at an attractive 9.0 times CY13 earnings per share (EPS), substantially lower than UEM Land's 22 times CY13 EPS.

Other factors were Sunway's low Iskandar land cost and favourable payment structure would ensure its long-term competitiveness and also Sunway's share price has lagged other Iskandar-focused developers, rising by 13% year-to-date vis-a-vis peers' year-to-date gains of 18%-48%.

Tags / Keywords: News, Business, Affin Investment Research, upgraded Sunway Bhd, attractive proxy to Iskandar Malaysia, Business

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