By Sharen Kaur
Malaysian Resources Corp Bhd (MRCB) is eyeing sizeable land in Kwasa Damansara, Selangor, that could translate into more than RM5 billion in gross development value (GDV), sources said.
They said MRCB is negotiating the land deal in Sungai Buloh with the Employees Provident Fund (EPF).
EPF’s unit, Kwasa Land Sdn Bhd, is the master developer of the 1,215ha township, which has a GDV of RM50 billion.
It is unclear how much MRCB, which is about 38 per cent controlled by the EPF, will pay for the plot of land it is eyeing.
A week ago, Pink Corner Sdn Bhd acquired 1.73ha for RM13.07 million, or RM70 per sq ft (psf), from Kwasa Land, while TRC Land Sdn Bhd paid RM6.13 million, or RM82 psf, for 0.69ha.
The two plots were sold above the reserved price by 13 per cent and 11 per cent, respectively.
Kwasa Land is projecting revenue of RM11 billion from sales of 540ha to public limited companies, government-linked companies, private developers and Bumiputera developers.
It bought the land from the Rubber Research Institute in 2012 for RM2.28 billion.
Analysts said MRCB can expect a rosy 2014 in terms of share price and earnings after a lacklustre performance last year, if it secures the deal soon and develops the land immediately.
Its earnings will also be driven by the RM6 billion PJ Sentral development and planned divestment of its 30 per cent stake in the concessionaire of Duta-Ulu Kelang Expressway (Duke) for RM230 million cash, they said.
For the nine months to September 30 2013, MRCB posted a net loss of RM111.34 million from a profit of RM63 million a year ago while revenue fell 37.3 per cent to RM607.4 million.
MRCB shares have succumbed to selling pressure, dipping to a 10-month low last December due to uncertainty about the company's prospects.
Investors, however, chased the stock ahead of MRCB's announcement of an asset disposal to a real estate investment trust last week.
AmResearch has re-initiated coverage on MRCB with a "buy" rating and a fair value of RM2.20 per share, a 20 per cent discount to its net asset value of RM2.75 per share.
Kenanga Research also upgraded its rating on the stock to "outperform" from "market perform", with a higher target price of RM2.01 from RM1.40 previously.
Kwasa Land has completed a pre-qualification exercise that has attracted 152 developers for the township development.
The top bidders include SP Setia Bhd, UEM Sunrise Bhd, Sunway Bhd, Mah Sing Group Bhd, IJM Land Bhd, Glomac Bhd, Gadang Holdings Bhd, WCT Bhd and Tropicana Corp Bhd.
RM5B GDV POTENTIAL: Company negotiating land deal in township with EPF, sources say
They said MRCB is negotiating the land deal in Sungai Buloh with the Employees Provident Fund (EPF).
EPF’s unit, Kwasa Land Sdn Bhd, is the master developer of the 1,215ha township, which has a GDV of RM50 billion.
A week ago, Pink Corner Sdn Bhd acquired 1.73ha for RM13.07 million, or RM70 per sq ft (psf), from Kwasa Land, while TRC Land Sdn Bhd paid RM6.13 million, or RM82 psf, for 0.69ha.
The two plots were sold above the reserved price by 13 per cent and 11 per cent, respectively.
Kwasa Land is projecting revenue of RM11 billion from sales of 540ha to public limited companies, government-linked companies, private developers and Bumiputera developers.
It bought the land from the Rubber Research Institute in 2012 for RM2.28 billion.
Analysts said MRCB can expect a rosy 2014 in terms of share price and earnings after a lacklustre performance last year, if it secures the deal soon and develops the land immediately.
Its earnings will also be driven by the RM6 billion PJ Sentral development and planned divestment of its 30 per cent stake in the concessionaire of Duta-Ulu Kelang Expressway (Duke) for RM230 million cash, they said.
For the nine months to September 30 2013, MRCB posted a net loss of RM111.34 million from a profit of RM63 million a year ago while revenue fell 37.3 per cent to RM607.4 million.
MRCB shares have succumbed to selling pressure, dipping to a 10-month low last December due to uncertainty about the company's prospects.
Investors, however, chased the stock ahead of MRCB's announcement of an asset disposal to a real estate investment trust last week.
AmResearch has re-initiated coverage on MRCB with a "buy" rating and a fair value of RM2.20 per share, a 20 per cent discount to its net asset value of RM2.75 per share.
Kenanga Research also upgraded its rating on the stock to "outperform" from "market perform", with a higher target price of RM2.01 from RM1.40 previously.
Kwasa Land has completed a pre-qualification exercise that has attracted 152 developers for the township development.
The top bidders include SP Setia Bhd, UEM Sunrise Bhd, Sunway Bhd, Mah Sing Group Bhd, IJM Land Bhd, Glomac Bhd, Gadang Holdings Bhd, WCT Bhd and Tropicana Corp Bhd.
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