Sunway Berhad / Jeffrey Cheah

Sunway Berhad / Jeffrey Cheah

Postby winston » Thu Oct 02, 2014 8:09 am

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22 Sep 2014: BST DJ RHB Raises Sunway's Target on Unit's Listing

0348 GMT [Dow Jones] RHB Research raises Sunway Bhd (5211.KU) target to MYR3.90 from MYR3.60 and keeps its buy call following the company's plan to list its construction business.

The house notes that looking at expected earnings and outstanding order book, the unit will be comparable to the top-listed construction companies, which are currently trading at up to a 17X price-to-earnings ratio on forward earnings.

"Sunway, our Top Pick for the sector, has a strategic business structure that allows it to unlock asset values from time to time, which benefits the shareholders over the long term," says RHB.

Given the prospects and the recent successful debut of Econpile Holdings (5253.KU), a small cap construction company, "we think a valuation multiple of 13X is justifiable," it adds. The stock is up 2.1% at MYR3.43.


Source: Dow Jones Newswires
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Re: Sunway Berhad

Postby winston » Wed Nov 05, 2014 5:04 pm

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Sunway dips 3% on report Singapore's GIC selling stake

By Yen Ne Foo

KUALA LUMPUR (Nov 5): Sunway Bhd ( Financial Dashboard) fell 11 sen or 3.28% on reports that Singapore-government investment arm GIC Pte Ltd (GIC) will sell its stake in the property and construction group.

At 4.08pm, Sunway fell to RM3.24 with some 1.5 million shares traded. Comparatively, the FBM KLCI fell 6.96 points or 0.4%.

GIC owns an 8.74% stake in Sunway, according to Sunway's statement to Bursa Malaysia.

Reuters, quoting a term sheet, reported the GIC was selling 7.26% of its stake in Sunway worth more than RM400 million.

It was reported that the shares were being priced between RM3.20 and RM3.30 each.

Following the share sale, Reuters reported the GIC would cease to become a substantial shareholder in Sunway.

A remisier with a local investment bank said the decline in Sunway's share price presented a “good buying opportunity” for those looking to accumulate the stock.

The remisier said Sunway was deemed undervalued.

“When foreign funds sell shares in big volumes, it is very normal for retailers to follow suit.

"But, Sunway is fundamentally strong and is only trading at a price-earnings ratio (PER) of around three to four times and this means it is slightly undervalued,” he said.

Bloomberg data showed that Sunway's PER compared with a sector average PER of about 20 times.

Source: The Edge
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Re: Sunway Berhad

Postby winston » Sat Nov 08, 2014 8:11 pm

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Re: Sunway Berhad

Postby winston » Fri Nov 14, 2014 9:34 am

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MIDF Research upgrades Sunway to Buy, raises target price to RM3.72

KUALA LUMPUR (Nov 14): MIDF Research has upgraded Sunway Bhd ( Financial Dashboard) to a Buy with a higher target price of RM3.72 (from RM2.93) and said it was upbeat on the proposed relisting of Sunway’s construction arm on the account of potential special cash dividend of 22 sen.

In a note Friday, the research house said the construction segment remains buoyant on the back of current outstanding orderbook and job replenishment of RM2 billion a year.

“Property unit will continue to do well due to the strategic location of its projects.

“Premised on the above, we upgrade Sunway Bhd to Buy recommendation with an increased target price of RM3.72,” it said.

Source: The Edge
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Re: Sunway Berhad

Postby winston » Mon Nov 17, 2014 10:03 am

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Sunway Bhd (Nov 14, RM3.27)

Upgrade to buy with an increased target price of RM3.72 from RM2.93: We recently met with Sunway Bhd’s management for updates on the progress of the proposed listing of its construction division.

Management reaffirmed plans to list Sunway Construction Group (SCG), the construction and pre-cast unit of Sunway Bhd. We were made to understand that the listing could be delayed from May to June 2015.

The bulk of proceeds from the listing would be returned to shareholders of Sunway via a one-for-10 dividend-in specie of SCG shares and special cash dividend which we estimate would amount to between one sen and 22 sen per share.

The remaining proceeds would be utilised for working capital and listing expense.

We opine that the contribution of Sunway’s construction unit has not been fully appreciated due to Sunway being largely seen as a property play.

This is understandable as the property and real estate investment trust (REIT) units explain 70% of its earnings.

Evidently, Sunway’s share price had hardly reacted to positive news flow of its construction unit securing various mega infrastructure projects.

With the proposed SCG listing, we expect the market to ascribe better value to Sunway’s construction assets as investors gain better insight into its capabilities, job secured and order book size.

Management indicated that SCG ranks third within the construction sector after IJM Corp Bhd and Gamuda Bhd in order book terms.

Its order book currently stands at RM3.2 billion (1.7 times financial year 2013 [FY13] construction revenue) of which only 15% are jobs from Sunway Group.

Management expects to secure another RM1.5 billion worth of external projects by end- 2014 which could easily provide another one to two years of earnings visibility.

We expect earnings for the construction division to grow by 11.4% in FY15 to RM110.2 million. Ascribing a low-end price-earnings ratio (PER) of 15 times for large-cap construction companies, we estimate SCG could potentially be worth RM1.28 per share.

Property sales have been encouraging so far with the company already locking in 48% of its financial FY14 sales target of RM1.3 billion.

We believe the strength of the property division is attributed to its strong track record which is underpinned by attractive projects that are benefiting from existing as well as future public transport connectivity nodes.

While the property division’s considerable exposure to Iskandar might pose a concern, we believe Sunway’s sound development plans and the strategic location of its projects could weather the softening property market.

Some notable features of its Iskandar project are ease of access to the proposed Coastal Highway Southern Link (CHSL), close proximity to two international airports in Senai, Johor and Changi, Singapore, and close proximity to two major international ports — Tanjung Pelepas Port in Johor and Jurong Port in Singapore.

Despite the potential overhang in the property sector after the removal of the developer interest bearing scheme (DIBS), the impact on property sales has been minimal thus far and this, according to management, is due to the property products being positioned at a premium to the market price which attracts serious buyers and/or property investors with a long-term horizon.

SCG could also benefit from the proposed CHSL. It participated in the tendering process and management is confident of securing the job for the construction of the stretch that links to the Second Link Expressway.

Apart from Sunway Iskandar’s strategic location, which provides a good selling point, the property unit could also benefit from revaluation gains of its assets.

Management views Sunway’s current net gearing of 0.3 times as healthy and the ratio is expected to remain unchanged after the relisting of SCG.

While the property investment unit would continue to require capital injection to expand its portfolio, management intends to keep its net gearing at no more than 0.5 times.

We believe the completion of Sunway Pyramid 3, Sunway University New Academic Block and Sunway Velocity Shopping Mall in 2015 could further strengthen the recurring income base for the property investment unit while retaining the group’s net gearing at a comfortable level.

We make no changes to our FY14 and FY15 estimates as we reckon the company’s earnings prospects are still on track to achieve our earnings forecasts.

In our view, the stock currently trades at undemanding multiples of 10.7 times FY14 PER and 10.1 times FY15 PER.

Furthermore, the potential special dividend payout post SCG listing would further enhance returns on the stock.

We upgrade our recommendation on Sunway to “buy” with a revised target price of RM3.72 (from RM2.93).

We apply a 40% discount to the property unit’s revised net asset value to account for the risks from various property cooling measures in Malaysia.

Source: MIDF Research
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Re: Sunway Berhad

Postby winston » Wed Nov 19, 2014 7:55 am

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Sunway 3Q14 profit hike 54.3%

KUALA LUMPUR (Nov 18): Sunway Bhd ( Financial Dashboard) recorded a 54.3% hike of net profit of RM143.7 million in the third quarter ended Sept 30, 2014 from RM93.15million a year ago due to better performance from most of the group’s business segments.

The company's revenue for the quarter also increased to RM1.13 billion from RM1.01 billion previous year.

“The better performance was due to higher profit contribution from most of the group’s business segments and the group’s treasury operation,” Sunway said in the announcement to Bursa Malaysia.

For the third quarter, the trading and manufacturing segment contributed the largest revenue, RM159.4 million (3Q13: RM151.9million); followed by property segment, RM151.8 million (3Q13:RM137. 1million); and quarry segment, RM56.3 million (3Q13:RM47.1 million).

However, in terms of profit before tax, property segment is the highest contributor, RM31.7 million (3Q13:RM24.6 million); followed by trading and manufacturing segment (3Q13:RM10.8 million); RM10.4 million and quarry segment, RM6.8 million (3Q13: RM5.4 million).

Sunway said that while the occupancy rate of Sunway Pinnacle has improved in the current quarter, it was not strong enough to enable it to break even yet.

“However, the rest of the other operations in this business segment recorded better performance. This was mainly due to the higher contribution from Sunway REIT ( Financial Dashboard) and stronger profits from the leisure and hospitality business, which achieved higher visitorship and better hotel occupancy rates,” it said.

Meanwhile, the performance of the trading and manufacturing segment remained satisfactory from its local operations but the overseas operations continued to remain challenging. Hence, the overall profitability was slightly weaker for this current quarter.

The better performance of the quarry segment was boosted by the stronger sales of premix, which partly offset the slower sales of aggregates.

For the nine-month ended Sept 30, Sunway’s profit grew 21.5% to RM430.2 million from RM354 million a year ago. Revenue came in marginally higher at RM3.36 billion versus RM3.2 billion in the previous year. Earnings per share, however, was lower at 24.96 sen against 25.33 sen the year before.

On the group’s outlook, Sunway said the group would be able to gain from a commendable economic growth for the Malaysian economy and the infrastructure projects announced by the government during Budget 2015.

“In the recent Malaysian Budget 2015, the Government announced that several infrastructure projects will be launched in next year, among them are the roll out of MRT Line 2, LRT 3, and several highway projects throughout the country.

“Given the proven track record of the group’s construction arm, it will be well positioned to bid competitively for such projects,” Sunway said.

Barring any unforeseen circumstances, the group is expected to continue to perform well in the last quarter of this financial year, it added.

Source: The Edge
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Re: Sunway Berhad

Postby winston » Wed Nov 19, 2014 8:55 am

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Sunway earnings up 54% on improved operations

PETALING JAYA: Sunway Bhd’s revenue climbed 13% to RM1.13bil while net profit jumped 54.3% to RM143.7mil for its third quarter ended Sept 30.

“The better performance was due to higher profit contribution from most of the group’s business segments and treasury operation,” the company said in a filing with Bursa Malaysia.

Its property development arm recorded a turnover of RM178mil and pre-tax profit of RM99.2mil, which are lower compared with RM260.3mil and RM90.4mil respectively achieved in the previous corresponding quarter.

“The lower revenue recorded in the current quarter was mainly due to slower progress billings, which is expected to improve in the next quarter,” it said.

The stronger profit was mainly due to higher profit recognition in some of the projects, which was further boosted by the lower common infrastructure cost allocated to the property development component within some of the integrated projects undertaken by the group, it added.

The stronger performance from its projects in Malaysia, however, was partially dragged down by the lower profit contribution from its Singapore ventures.

On the other hand, its construction segment fared better this year, raking in RM488.2mil in revenue and RM17.7mil in pre-tax profit compared with RM376.5mil and RM15.5mil respectively last year.

The increase in revenue and pre-tax profit this year was mainly due to improved sales of precast concrete products in Singapore and higher progress billings of its ongoing local civil engineering and building projects.

Its property investment segment reported topline of RM151.8mil and pre-tax profit of RM31.7mil, which are up 10.7% and 28.9% respectively year-on-year.

The group’s trading and manufacturing unit registered revenue of RM159.4mil, an increase of 4.9% compared with last year while pre-tax profit fell marginally to RM10.4mil primarily due to challenging operations overseas.

For its first nine months, Sunway’s revenue added 5% to RM3.36bil while net profit rose 21.5% to RM430.22mil compared with the same period last year.

In a separate announcement, JP Morgan Chase & Co ceased to be a substantial shareholder after disposing of 97.93 million Sunway shares that represented a 5.7% stake on Nov 10.

The banking giant emerged as a substantial shareholder on Nov 4 after it acquired 97.95 million shares.

Source: the Star
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Re: Sunway Berhad

Postby winston » Wed Nov 19, 2014 10:53 am

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Affin Hwang Research upgrades Sunway to Buy

KUALA LUMPUR: Affin Hwang Research has upgraded Sunway to a Buy on share price weakness with a target price of RM3.60.

In a note on Wednesday, the research house said Sunway's nine months 2014 core earnings came within the research house's and street estimates.

The growth in earnings was driven by higher contribution from property segment, construction and others.

"However, this was mitigated by lower contribution from trading segment. No dividend was declared during the quarter," it said.

Meanwhile, its total construction order book replenishment stood at RM 881mil as at end-Oct 2014, bringing the total order books to RM 3.3bil

Source: The Star
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Re: Sunway Berhad

Postby winston » Sun Nov 23, 2014 5:59 pm

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Sunway shares up on bullish 3Q results
19 November 2014

KUALA LUMPUR: Sunway Bhd’s shares rose four sen to RM3.27 as at 9.36 am, with demand boosted by its bullish third quarter results.

During the quarter, which came within analysts and consensus expectations, Sunway’s core earnings increased 20 per cent to RM149.3 million compared to the same quarter a year ago.

For the nine months period, the core earnings expanded to RM386 million.

Property sales stood at RM323 million, taking the nine months 2014 sales to RM951 million.

Following this, AffinHwang Capital has upgraded its recommendation on Sunway to “buy” from the previous “add“, with an unchanged target price of RM3.60.

“We continue to like Sunway for its strategic property land bank and extensive experience in the construction sector,” the research house said in a note today.

Meanwhile, AllianceDBS Research said the listing of Sunway Construction Group is on track, and to be completed by the second quarter 2015.

It said Sunway’s vast land bank, worth RM50 billion in gross development value across the Klang Valley, Iskandar Malaysia and Penang, would ensure sustainable growth going forward.

AllianceDBS has maintained a “buy” call on Sunway with a RM3.90 target price.

Source: Bernama
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Re: Sunway Berhad

Postby winston » Sun Nov 30, 2014 6:50 am

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