By Sharen Kaur
Published in NST on August 16 2011
SP SETIA Bhd's recent land purchase in Ulu Langat, Selangor, is considered relatively cheap compared to what UEM Land Holdings Bhd had paid for in the same location last December.
Last Friday, SP Setia said it would pay RM330.1 million or RM7.50 per sq ft (psf) for a 404ha of land, almost half of the RM13.30 psf price tag that UEM had paid for 186ha.
SP Setia plans to undertake a mixed development project, with potential to generate a gross development value of RM3.5 billion. The eight-year project is expected to start in 2013.
ECM Libra Investment Bank said assuming an 18 per cent net margin, the project will generate net profit of RM630 million over the development period.
The research house is maintaining its target price of RM4 on SP Setia shares.
SP Setia, Malaysia's most valuable property company with a market capitalisation of nearly RM6.85 billion, closed at RM3.84 a share yesterday.
AmResearch also reaffirmed a "buy" call on SP Setia at a fair value of RM5.41 per share.
"We gather the maiden launch will be kicked off with affordable houses, with typical link houses in the region of RM300,000 to RM350,000 per unit," AmResearch said.
OSK Research Sdn Bhd is maintaining its "buy" call on SP Setia with an unchanged fair value of RM4.82. It is positive on the acquisition and the proposed development as it believes it will enable SP Setia to tap strong demand for attractively-priced homes by first-time owners and other home buyers in the Semenyih-Kajang corridor.
Kenanga Research expects the project to contribute significantly to SP Setia's earnings in its financial years 2013/2014 onwards. It is maintaining the fair value of SP Setia at RM4.73.
Hong Leong Financial Group is maintaining a "hold" call on SP Setia as it does not expect any significant impact for its fiscal years 2011 to 2013.
"We expect SP Setia to focus on existing projects such as KL Eco City, Setia Alam/Eco Park, Setia Sky Residences and Fulton Lane in Melbourne during the period," said its analyst, Joanne Wong Pui Mei.
-ENDS-
Published in NST on August 16 2011
SP SETIA Bhd's recent land purchase in Ulu Langat, Selangor, is considered relatively cheap compared to what UEM Land Holdings Bhd had paid for in the same location last December.
Last Friday, SP Setia said it would pay RM330.1 million or RM7.50 per sq ft (psf) for a 404ha of land, almost half of the RM13.30 psf price tag that UEM had paid for 186ha.
SP Setia plans to undertake a mixed development project, with potential to generate a gross development value of RM3.5 billion. The eight-year project is expected to start in 2013.
ECM Libra Investment Bank said assuming an 18 per cent net margin, the project will generate net profit of RM630 million over the development period.
SP Setia, Malaysia's most valuable property company with a market capitalisation of nearly RM6.85 billion, closed at RM3.84 a share yesterday.
AmResearch also reaffirmed a "buy" call on SP Setia at a fair value of RM5.41 per share.
"We gather the maiden launch will be kicked off with affordable houses, with typical link houses in the region of RM300,000 to RM350,000 per unit," AmResearch said.
OSK Research Sdn Bhd is maintaining its "buy" call on SP Setia with an unchanged fair value of RM4.82. It is positive on the acquisition and the proposed development as it believes it will enable SP Setia to tap strong demand for attractively-priced homes by first-time owners and other home buyers in the Semenyih-Kajang corridor.
Kenanga Research expects the project to contribute significantly to SP Setia's earnings in its financial years 2013/2014 onwards. It is maintaining the fair value of SP Setia at RM4.73.
Hong Leong Financial Group is maintaining a "hold" call on SP Setia as it does not expect any significant impact for its fiscal years 2011 to 2013.
"We expect SP Setia to focus on existing projects such as KL Eco City, Setia Alam/Eco Park, Setia Sky Residences and Fulton Lane in Melbourne during the period," said its analyst, Joanne Wong Pui Mei.
-ENDS-
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