PETALING JAYA: Mah Sing Group Bhd
is likely to undertake more land bank replenishment after its latest acquisition in Ampang, Selangor, its first land acquisition in 2026, according to UOB Kay Hian (UOBKH) Research
The research house said the property developer has a healthy balance sheet giving it room to pursue further opportunities.
On Wednesday, Mah Sing announced that its wholly-owned subsidiary had entered into three conditional sale and purchase agreement with Chin & Tan Holdings Sdn Bhd to acquire 14.38 acres of adjoining land in Ampang, Selangor for RM186.17mil.
The site is earmarked for M Araya, a mixed development, with 10% commercial component, and an estimated gross development value (GDV) of RM1.92bil.
The project targets young professionals, first-time homeowners, growing families and upgraders, with prices starting from RM399,000 and indicative apartment sizes of 700 sq ft and 1,000 sq ft.
According to UOBKH Research, upon completion, Mah Sing’s total remaining GDV is expected to rise 5% to RM35.1bil, from RM33.2bil as at end of first quarter of financial year 2026 (1Q26).
M Araya marks Mah Sing’s third development in Ampang after the fully sold M Suites and M City.
UOBKH Research said the land entry cost was attractive, with the RM186.17mil purchase translating into RM297 per sq ft and a land cost-to-GDV ratio of 9.7%, which was at the lower end of Mah Sing’s recent acquisition range.
“Given that the group replenished about RM5.5bil to RM6.4bil of GDV per annum over 2023 to 2025, we expect further land bank replenishment for the remainder of 2026, supported by its healthy balance sheet,” UOBKH Research said in a report.
The research house expects the acquisition to be completed within 12 months, with registration of interest targeted for 1Q27 and the project slated for launch in 2027.
“Assuming a net margin of 10%, earnings recognition from 4Q27 and a four-to-five-year development period, we estimate M Araya could contribute RM10mil/RM38 mil or 3%/12% of our 2027/2028 earnings forecast.
“Our pro forma target price would rise by around 3% to RM1.46 (from RM1.42).”
Meanwhile, BIMB Research was also positive on the acquisition, noting that it added “meaningful GDV from a relatively small urban land parcel”.
It said the land cost of about RM297 per sq ft, or just 9.7% of the estimated GDV, giving Mah Sing room to price M Araya competitively.
BIMB Research said based on current feasibility studies, earnings before interest and taxes plus profit before tax margins for M Araya are expected to be broadly in line with Mah Sing’s existing M-Series projects.
As such, the low land cost is likely to offer greater flexibility in pricing and support sales velocity, rather than drive a significant expansion in project margins.
Based on Mah Sing’s latest reported net gearing of 0.39 times as at end-March 2026, the acquisition could lift net gearing to about 0.44 times if fully reflected in net debt, which remains manageable.
An analyst at another research house said the group’s liquidity remained strong despite the increase in gearing.
He said proceeds from the recent Southville City land disposal should provide Mah Sing with funds to reinvest in its property development business.
