Eco World Development / Leong Kok Wah

[winston]

Eco World Development (ECW MK) Sharing Prosperity

While the lifting of geographical restrictions for ECW and ECWI may initially seem like cannibalisation, we view it as a positive long-term move for ECW.

ECW benefits from:
a) generating income fees as the potential project manager for EWI’s projects, and b) an increased landbanking capacity via JVs with a zero-gearing EWI.

Importantly, EWI, currently still making losses, will no longer drag ECW’s earnings due to its reclassification to mark-to-market valuation.

Maintain BUY. Target price: RM2.37.

Source: UOBKH

https://research.uobkayhian.com/content ... e=hs_email

[winston]

Industrial land sales provide earnings buffer

Industrial land sales to drive earnings

While the revised 6% SST adds uncertainty to short-to-medium-term earnings, especially from its duduk affordable apartments, we believe ECW’s industrial properties will provide some buffer due to better margins.

Given the strong earnings outlook for FY25-27E, a higher dividend payout is possible.

We maintain our core net profit forecasts and MYR2.21 TP (0.7x P/RNAV) pending the release of the 2QFY25 results next week. BUY.

Source: Maybank

https://mkefactsettd.maybank-ke.com/PDFS/465541.pdf

[winston]

not vested

Eco World Development (ECW MK) 2QFY25: In Line;

Gearing Up For Industrial And Residential Launches In FY26 ECW posted in-line results.

Sales momentum remained strong in Mar-May 25, with 26% from industrial and 32% from residential in the southern region.

Net gearing is expected to stay elevated in the near term as it ramps up for three major launches in FY26 and the construction of its build-to-lease DC.

Nonetheless, management remains committed to maintaining dividend payments, backed by strong cash generation and remaining land sales proceeds of RM1.3b.

Maintain BUY with a higher target price of RM2.39.

Source: UOBKH

https://research.uobkayhian.com/content ... e=hs_email

[winston]

not vested

All good, all gears ahead

Profit and sales in line; maintain BUY

ECW’s 2QFY25 core net profit of MYR115m (+60% YoY, +43% QoQ) was in line.

7MFY25 property sales of MYR3b made up 86%/66% of ECW’s/our FY25 sales target/assumption.

We adjust our FY25-27E earnings forecasts by 15% to +6% mainly due to changes in land sale recognition assumptions.

We are not overly concerned on the temporary uptick in net gearing (0.55x in end-2QFY25), given the MYR1.8b in cash and MYR5.2b in unbilled sales (1.3x FY26E rev).

Our TP is MYR2.23 (+2sen, on an unchanged 0.7x P/RNAV). Reiterate BUY.

Source: Maybank

https://mkefactsettd.maybank-ke.com/PDFS/467370.pdf