KUALA LUMPUR: Maybank Investment Research is positive on UEM Sunrise Bhd
's latest land purchase in Seri Kembangan for the fair pricing and the company's diversification of geographical spread.
The research firm expects a marginal one sen enhancement to its real net asset value per share estimate on the basis of a 20% pre-tax margin and five-year development period.
"In our view, the shift of focus to Klang Valley will be positive for UEMS over the long-term in term of geographical diversification. With an implied upside of +30% to
our TP, UEMS remains a tactical BUY," it said.
UEM Sunrise announced yesterday it had entered a sales and purchase agreement with Kemaris Residences Sdn Bhd to acquire 19.24 acres of land in Taman Equire in Seri Kembangan for RM109.5mil cash.
The land obtained a development order for 924 residential units of apartments, and is in proximity to the Equine Park MRT station undergoing construction as well as AEON Taman Equine, Alice Smith International School and two hypermarkets.
"UEMS’ latest land purchase in Seri Kembangan is in line with management’s strategy in reducing exposure in Iskandar Malaysia and expanding landbank in the Klang Valley," said Maybank IB Research.
"We are positive on the deal for its relatively lower pricing as compared to LBS’ recent land acquisition there at MYR181psf. UEMS will develop the land into a high-rise apartment and landed residential project targeting upper-mid income property buyers, we understand."
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