PETALING JAYA: Eco World Group Development Bhd’s (EcoWorld Malaysia) move to develop land in Negri Sembilan’s Malaysia Vision Valley 2.0 development corridor is being viewed positively by analysts.
EcoWorld Malaysia announced last week that it had signed an agreement with SD Guthrie Bhd and NS Corp to transform 483.59ha of land in Bukit Pelandok, Port Dickson, into an integrated industrial park.
The deal has EcoWorld Malaysia holding a 55% stake in the development, while SD Guthrie and NS Corp will hold 30% and 15%, respectively.
While positive on the joint venture and its prospects, Maybank Investment Bank Research, which maintained a “buy” call on EcoWorld Malaysia, has factored in a revised net asset value (RNAV) of three sen to account for the project and revised the company’s target price to RM2.21 from RM2.51 to reflect the risk of a slower economy that may pose risks to sales.
“This is consistent with our valuation of big-cap developers,” the research house said, adding that EcoWorld Malaysia remains its top buy among property stocks, noting that the land was located in a relatively established industrial area with good road connectivity.
“We view the latest venture positively due to its strategic location and fair pricing. The RM11 per sq foot (psf) is within market range,” the research house said.
Comparable deals in the state include Matrix Concept Holdings Bhd
’s RM8.63 psf average purchase price for 963.96ha in nearby Sendayan announced in August 2022 and June 2024, and the current asking price of RM38 psf for 2.35ha in Bandar Enstek in March.
MIDF Research said the development of the industrial park would expand the company’s industrial development segment.
“Note that sales from Eco Business Parks contributed 12% to total sales for the group in its financial year ended Oct 31, 2024,” the research house said.
MIDF Research has kept a “buy” call on the stock with a revised target price of RM2.05 from RM2.02 after accounting for RNAV contribution from the project.
“We remain positive on EcoWorld Malaysia as the growing contribution from industrial development bodes well for future growth,” it added.
EcoWorld Malaysia recorded a net profit of RM80.34mil in its first quarter ended Jan 31, 2025, from RM69.63mil in the same period last year.
Revenue for the quarter was slightly higher by 0.3% to RM539.63mil from RM537.79mil previously.
