KUALA LUMPUR: AmInvestment Bank Research says Sunway Bhd
's outlook remains stable given its strong unbilled sales, robust order book, stable income and expansion in healthcare.
In its update report, the research house maintained its buy call on the group with a lower fair value of RM1.65 per share from RM1.71 previously.
It reduced its FY18 and FY19 earnings forecasts 6.5% and 11.2% to RM576.2mil and RM590.5mil respectively and introduced its FY20 earnings forecast at RM612.1mil.
AmInvestment noted that Sunway has been reclassified from the properties sector to trading/services in Bursa Malaysia to reflect its ambition to grow into non-property-related business.
The group's landbak of 3,308 acres has a total gross development value of RM54.4bil, giving it long-term earnings visibility and will drive the company's growth.
Meanwhile, revenue will be boosted by unbilled sales stands of RM1.4bil and a slew of new launches in FY18-19.
Sunway Construction's outstanding order book stands at RM5.6bil, which will provide stable income for the next one to two years.
"The group is expanding its healthcare business with plans to build 4 more hospitals. The new hospitals will be within its integrated developments in Sunway Velocity, Seberang Jaya, Sunway Damansara and Sunway City Ipoh. The Sunway Velocity hospital is currently under construction and is expected to be completed by 1Q2019," said AmInvestment.
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