PETALING JAYA: Eco World Development Group Bhd
(EcoWorld Malaysia) may exceed its RM4bil sales target for the financial year ending Oct 31, 2026 (FY26), after achieving more than half of the goal within the first four months of FY26 (4M26), driven by strong demand for its township and industrial developments.
According to UOB Kay Hian (UOBKH) Research, the property developer posted RM2.1bil in sales for 4M26, up 7% year-on-year (y-o-y) and representing 52% of its full-year target.
The research house said this is slightly ahead of its FY26 forecast, accounting for 43% of the RM4.8bil full-year projection.
The strong sales were achieved without any large-tract land deals, unlike last year when data centre (DC) land transactions boosted sales, although revenue was supported as sales from the previous year were recognised.
For the first quarter ended Jan 31, 2026 (1Q26), EcoWorld Malaysia reported a core net profit of RM156mil, up 96.8% y-o-y, on revenue of RM1.35bil, representing a jump of 150.8% from the previous corresponding quarter. UOBKH Research said 1Q26 earnings represented 29% of its and consensus full-year earnings estimates “which we deem in line due to the completion of two DC land sales during the quarter”.
The research house estimates that EcoWorld Malaysia still has about RM424mil in land sale revenue to be recognised over the remaining quarters.
In 1Q25, EcoWorld Malaysia sold 138.53 acres of industrial land in Eco Business Park I (EBP I), Iskandar Malaysia to Microsoft Payments (M) Sdn Bhd for RM693.96mil and 58.19 acres in Eco Business Park V to Google’s affiliate, Pearl Computing Malaysia Sdn Bhd, for RM266.1mil.
While the total land sale proceeds from these two transactions amounted to RM960mil, UOBKH Research estimated that RM750mil of this was recognised in 1Q26.
It said the remaining RM210mil will be recognised progressively as infrastructure work at EBP I is completed.
As of end-1Q26, EcoWorld Malaysia’s unbilled sales increased to RM5.1bil from RM4.9bil a quarter ago, while net gearing declined to 0.17 times from 0.28 times.
UOBKH Research pointed out that EcoWorld Malaysia’s gross profit margin declined to 26.6% in 1Q26 from 28.4% a year ago.
It said this was largely due to the timing of project completion, more apartments being constructed this quarter, and more conservative cost provisions for ongoing phases amid higher input costs.
UOBKH Research has maintained a “buy” call on the stock, with a target price of RM2.70.
Meanwhile, RHB Research has maintained its “buy” call but tweaked its target price up by three sen to RM3 a share, following an update to landbank and realisable net asset value data.
“Management’s FY26 sales target of RM4bil could be reached earlier, driven by strategic pipeline launches,” it said.
“Together with the remaining Quantum (industrial revenue pillar) land sale revenue of RM214mil to be recognised, this implies approximately RM424mil of remaining DC land sale to be recognised in the remaining quarters (versus RM750mil in 1Q26) based on our estimates.”
