MBSB Research has not made any changes to the earnings forecast for FY25 to FY27.
PETALING JAYA: EcoWorld Development Group Bhd, which recently acquired 9.2ha of freehold commercial titled land in Semenyih, Selangor, adjacent to the company’s freehold 342.8ha Eco Radiance township, is expected to launch higher-priced properties to cater to growing demand in the area next year.
MBSB Research, which maintained a “neutral” call on the stock with an unchanged target price of RM2.19, said the company aims to continue the success it has achieved in Semenyih with the targeted launch of Eco Radiance in the first half of its financial year ending Dec 31, 2026 (FY26).
“We understand that Eco Radiance will feature more higher-end products and commercial development to meet the booming demand for commercial development amid growing population in Semenyih,” it said.
The research house said Eco Radiance, with a total gross development value (GDV) of RM5.16bil, would continue the success of the company’s two ongoing township developments in the area – the freehold 440.7ha Eco Majestic and the 200ha Eco Forest.
MBSB Research said following a recent visit to these townships that the upcoming Eco Radiance township should continue the company’s success in the southern Klang Valley. However, it has not made any changes to the earnings forecast for FY25 to FY27 and expect positive earnings prospects from land sales.
“Nevertheless, valuation of EcoWorld is rich as it is trading at 24% premium to latest net tangible asset of RM1.70 per share,” it said, adding that the company targets to grow recurring income to 20% to 30% in the medium term from rental income, including from Majestic Labs, a 1.45ha commercial project with an occupancy rate of 70%.
The company still have 120ha of remaining landbank in Eco Majestic with a GDV of RM6.41bil mainly for commercial use while Eco Forest, which caters to mid-to-mass-market housebuyers, have an undeveloped landbank of 46.1ha and GDV of RM1.37bil.
