PETALING JAYA: Skyworld Development Bhd
’s earnings have reached an inflection point and are expected to recover, supported by a stronger launch pipeline and improving unbilled sales, says Hong Leong Investment Bank (HLIB) Research.
The research house forecasts a sharp earnings recovery for financial year 2026 (FY26) to FY28, with earnings projected at RM35mil, RM77mil and RM149mil, respectively.
This translates into a two-year compound annual growth rate of 104.7%.
In its report initiating coverage on SkyWorld, the research firm noted that as at Dec 31, 2025, the group had six ongoing projects, with five in Kuala Lumpur and one in Penang, with total ongoing gross development value (GDV) of RM2.66bil.
As for future developments, the group has remaining GDV of RM19.81bil, with the majority 61% from Penang, 34% from Kuala Lumpur and the rest from Vietnam.
It has a “buy” rating on the stock with a target price of 90 sen a share, based on 60% discount on its estimated revalued net asset value of RM2.25.
The shares were last traded at 43 sen.
“SkyWorld’s earnings has reached an inflection point after several years of launch gaps, which led earnings to fall from its fourth quarter of its financial year ended March 31, 2023 (4Q23) peak of RM58mil to a trough of RM5.1mil in 1Q26.
“Since then, the group has rebuilt its project pipeline, lifting ongoing projects to six, slightly above the number of projects during its peak earnings level.
This has driven unbilled sales to surge by 83.8% quarter-on-quarter to RM1.08bil in 3Q26,” HLIB Research said in its report.
According to the research firm, Penang is now emerging as a new growth driver, accounting for 61% of remaining GDV through its Seberang Jaya and Batu Kawan projects.
“Seberang Jaya benefits from a mature catchment near Sunway Medical Centre Penang and Sunway Carnival Mall, while Batu Kawan is positioned within Penang’s industrial growth corridor and an underserved affordable housing segment.”
However, it said the group’s potential recovery has yet to be reflected in the share price, which was trading at undemanding FY27 to FY28 forward price-to-earnings of merely six and 3.1 times, respectively.
