PETALING JAYA: Sunway Bhd
is expected to gain around RM40.4mil in annual earnings from its latest joint venture (JV) development project with Sing Holdings Ltd in Singapore, following its successful bid for the government land sale site at Chuan Grove in Singapore.
The JV between Sunway and Sing Holdings had emerged as the top bidder for the government land sale tender for the development of a residential site at Chuan Grove, Singapore, with an offer of S$703.6mil, representing a 7.3% premium over the second-highest bid.
The 99-year leasehold site spans 170,409 sq ft and can yield about 555 units.
Following the award of the tender and approval by the Urban Redevelopment Authority, the two parties will establish a JV company in Singapore, with Sing Holdings holding a 65% stake and Sunway the remaining 35%.
According to Hong Leong Investment Bank (HLIB) Research, the project is expected to launch sometime between the second half of financial year 2026 (2H26) and 1H27.
It was also noted that the collaboration with Sing Holdings marks Sunway’s first partnership with the group in Singapore and will help replenish its pipeline of private residential projects.
Sunway’s previous Singapore developments have primarily been undertaken with long-time partner Hoi Hup Realty Pte Ltd.
Sunway currently has five projects in the republic, including private condominiums The Continuum and Terra Hill, executive condominiums Novo Place and Otto Place, and an upcoming Tampines launch in 1H26.
Otto Place, its latest executive condominiums project, is currently being previewed and is slated for booking on July 19.
“With the launch of Otto Place executive condominiums, Sunway will have four ongoing projects concurrently in Singapore, the highest number in its history,” HLIB Research noted.
Citing the strong performance of the nearby Chuan Park project where 84% of units have been sold at an average price of S$2,585 per sq ft, HLIB Research expects the Chuan Grove development to benefit from sustained demand in the area.
The land cost of S$1,376 per sq ft is considered in line with comparable transactions, including The Orie at Toa Payoh.
“The net profit margin of a private residential project ranges from low-to-mid teens.
“Thus, based on our estimated effective gross domestic value of RM1.62bil, assuming 10% net margin, four-year recognition timeline, the share of profit per annum is estimated to be around RM40.4mil, likely to be recognised over the financial year 2027 to 2030,” said the research house.
HLIB Research made no changes to its earning estimates.
It also maintained a “buy” call on Sunway with an unchanged target price of RM5.90.
“With the group’s widening exposure in the Malaysian economy, the stock provides a good proxy to the domestic economy, which is currently entering a new phase of growth,” it added.
