Mah Sing - The Icon @ Jalan Tun Razak

Once again, article from The Edge:


KUALA LUMPUR: Mah Sing Group Bhd subsidiary Star Residence Sdn Bhd is selling one of two wings of The Icon Jalan Tun Razak, a grade A office development, to Koperasi Permodalan Felda Bhd for RM174.4 million in an en bloc deal.

In a statement yesterday, Mah Sing said Star Residence had entered into a sale and purchase agreement (SPA) with Felda for the proposed sale of the 20-storey West Wing of The Icon.

It said the transaction value for the wing, which had a total floor area of 243,830 sq ft, worked out to be RM715 per sq ft. Included in the purchase price are 301 carpark bays.

Upon the execution of the SPA, Felda will pay RM17.44 million or 10% of the purchase price, with the balance 90% to be paid progressively according to the stage of works completed.

Mah Sing’s group managing director Datuk Leong Hoy Kum said: “With the strong demand for commercial developments, we will continue to target more prime commercial land in Kuala Lumpur and the Klang Valley for our Icon series of commercial developments.”

“Moving forward, we target to conclude more en-bloc sales for our Icon series of commercial developments, including The Icon Mont’Kiara, where the signature tower will house SoHo units and corporate designer suites.

“With our expertise in lifestyle developments, we will raise the bar for commercial developments in our Icon series, melding trendy features into our practical designs,” he said.

Leong said with a seven-year track record of on-time delivery of quality properties, the group was confident that the Icon series of commercial properties would soon make an impact on the market.

He said construction of The Icon Jalan Tun Razak was scheduled to be completed in 24 months inclusive of the issuance of the certificate of practical completion.

“Besides making The Icon a landmark in the vicinity, we are confident that it will value add in terms of potential capital appreciation in the future as we are looking at total returns instead of just yields,” Leong said.

He said the group was targeting local and international companies which were increasingly active in the central business district.

Leong said with the economy performing well, the demand for grade A offices was growing unabated as there were a trend of companies to locate to high profile locations.

He added that with The Icon Jalan Tun Razak expected to be completed before other purpose-built office buildings in the area, the group was confident of further capital appreciation.

E&O Prop: New launching @ STP

Article from The Edge:


KUALA LUMPUR: E&O Property Development Bhd will be launching an upscale exclusive service apartments in Penang.

Called the Suites at Waterside, the luxurious one- and two-bedroom service apartments are built around the Waterside at Seri Tanjung Pinang, which encompasses a pleasure marina, waterfront promenade, retail marketplace as well as a five-storey lighthouse dubbed The Beacon.

Comprising 160 units, each apartment is priced between RM445,000 and RM1.25million. Prospective buyers can choose from four floor plans, with build-up areas ranging from 853 sq ft to 2,568 sq ft.

Slated to be completed in 2010, the 4.8ha site of the project emulates some of the well-known waterfront destinations in Australia, the Mediterranean and the US.

“This is Penang island’s first service apartment of a truly five-star calibre. Aside from its exquisitely appointed interiors, the Suites at Waterside are unique due to its seafront resort lifestyle concept fronting a vibrant marina,” said E&O Property Development marketing and sales director KC Chong.

He said the Suites at Waterside presents a rare opportunity for those looking for investment in a property, vacation getaway or a retirement home.

Currently, phase one covering 96ha introduces landscaped parks, boulevards and seafront esplanades in a guarded community of terraced, semi-detached and detached homes, condominiums and service apartments, and commercial and retail precincts.

Phase two of the project will consist of 296ha with a cluster of islands emerging offshore, linked via a series of bridges.

Mah Sing - Another commercial project

Below is the article from The Edge:


KUALA LUMPUR: Mah Sing Group Bhd plans to undertake a RM256 million project, called Southgate Commercial Centre, along Jalan Tun Razak.

It announced on July 27 that the project would be build on 1.92-ha freehold land which it was acquiring for RM52 million or RM250.90 per sq ft from Ninchii Fashion Sdn Bhd.

Mah Sing group managing director Datuk Leong Hoy Kum said the company was targeting corporate and high-end customers, including professionals, investors and entrepreneurs for the Southgate Commercial Centre.

“With the prime address and easy accessibility, law firms, consultancies and advertising agencies are just a few of the professions which could set up office here,” he said. It was also seeking to attract niche boutiques and specialty stores.

Southgate Commercial Centre, modelled after the Xintiandi success story in Shanghai, was conceptualised as an integrated commercial and leisure hub and is expected to be completed in three years.

With its Southgate Commercial Centre, Mah Sing has 14 development projects with a total gross development value (GDV) of RM3.726 billion.

Together with its unbilled sales of RM430 million as at March 31, 2007, the total GDV of RM4.156 billion would ensure earnings visibility for the company for over seven years.

Southgate Commercial Centre was the company’s third commercial development in Kuala Lumpur after its Grade A office development in Jalan Tun Razak and its integrated lifestyle development offering office suites enclosed by a resort style plaza in Mont’ Kiara.

Eupe Corporation Bhd - Goldman Sachs

Goldman Sachs is in action again :

The Goldman Sachs Group, Inc has emerged as a substantial shareholder in property developer EUPE Corporation Bhd with a 5.72% stake.

A filing with Bursa Malaysia showed that Goldman Sachs acquired 2.2 million EUPE shares on July 11.

The acquisition raised its shareholding to 7.32 million shares.

The Kedah-based company's share price surged to RM1.34 on July 11, riding on the positive outlook for property companies.

Property Sector

Below is the research report from HDBS:

􀂾 Demand to pick up. We notice the recent trend and incentives by the government is changing the property industry structurally and expect long-term positives occurring in the sector, especially the high-end segment.

􀂾 Untapped foreign market. The lifting of RPGT, easing of foreign ownership and speedy delivery systems are in our view, important and liberal measures taken by the government to improve the attractiveness to the largely untapped foreign demand. The government has a target of at least RM20b foreign ownership by 2010. Early signals such as appreciation in prime land prices, increase in selling prices of high-end properties and high pre-sold sales indicate that our properties, especially the
luxury segment, are due for re-rating.

􀂾 Maintain Overweight. Financially strong developers with strong branding and properties skewed to mid-high end are set to benefit. YTL Land (YTLL MK, PT RM3.30) and Sunrise (Sun MK,PT RM4.90) are our picks for the sector to ride on the property
upcycle.

Mah Sing - Target Prices

Research houses Macquarie and KAF Seagroatt & Campbell Securities set their target prices of RM2.60 and RM2.75 respectively on Mah Sing. These target prices are adjusted after the bonus issue and stock split undertaken by Mah Sing.

Mah Sing closed at RM2.30 last Friday. Thus, the target prices imply a potential 13% to 19%.

The ex-dividend date of this stock is on 1 Aug 2007.

Northern Growth

The below property companies have been picked by The Edge, to watch in Penang property play:

1. Sime Darby Bhd - front runner for the job to upgrade Penang International Airport;

2. Equine Bhd - holds a 25% stake in a projects to redevelop 249 acres of prime land currently occupied by the Penang Turf Club (named Penang City Park with an estimated of RM25bil GDV);

3. Oriental Holdings Bhd - owns 118 acres of vacant freehold land on Penang Island, which were acquired many years ago at a low cost of RM10.56 psf;

4. E&O Property Development Bhd - developing Sri Tanjung Pinang and owns 355.58 acres of vacant freehold land in the South West district at a cost of RM120.5mil, or RM7.78 psf;

5. Mah Sing Group Bhd - will develop Southbay Penang which is expected to generate a total of RM1.28mil;

6. Hunza Properties Bhd - a local Penang-based developer; and

7. Sunway City Bhd - owns a 38.61 acres of vacant freehold land in Penang Island and has completed several projects as well successfully.

More ... Glomac Bhd

There was a negetive article about Glomac, back in May 2007. Some analysts raised their concerns as the group's flagship project - Aman Suria Damansara is nearing completion, no clear project substantial enough to fill the earnings of Aman Suria Damansara for FY2007 to FY2008. It is further reported that newer commercial projects, when completed, may be caught at the wrong end of the office property cycle. An analyst adds: "With the property sector boom in the early cycle and the government launching more incentives to boost the sector, it may be too early to call a 'sell' on Glomac.

For the Financial Year Ended 2007, Glomac recorded a total of RM293mil revenue, with net profit of RM32mil. The revenue is slightly higher as compared to preceding year [RM285mil]. However, net profit is slight lower [RM32mil vs RM37mil]. Glomac has declared a total of 9 sen dividend for both financial years. Net assets per share has increased moderately from RM1.81 to RM1.90.


Meanwhile, Glomac has moved beyond Malaysia. The group has identified some 30 acres in Pune (India), a second-tier city with a population of about six million, to build its first residential projects overseas. This planned project will concentrate on high-end residential homes targeted at the locals.

To recap, Glomac already has investments in Australia and Thailand. Last year, it purchased an office building for A$30.5mil in Melbourne and bought into a Thai company specialising in constructing warehouses. Glomac inked the partnership earlier this year and WHA Glomac Aliance Co Ltd was formed.

WHA Glomac Alliance officially handed a purpose-built pharmaceutical warehouse for Dielthlem Ltd on July 9. It is located on 76,000 sq m of freehold land in Bangkok's Samutprakam province. Two warehouses haven been buily offering some 550,00 sq ft of space. It will be leased to Dielthlam for 15 years with rental to increase by 10% every three years. This has created a good recurring income for the group

At home, Glomac is being kept busy with several commercial projects that are expected to take of next year. Plans have been submitted [Glomac Tower] and the group is confident that it will be start working early next year even with the official freeze on construction of office building in the city. Any developer who wants to put up an office building in the city has to ensure its secures a substantial percentage of tenants who require the space. Glomac's executive vice-chairman, Datuk Richard Fong confirms that Glomac has secured some 'big tenants'. Glomac is looking at some banks from Middle East taking up the space. This is by virtue of its partnership with Al Batha.

Lastly, Glomac would prefer to look at India for the time being, rather than IDR or Penang.


Closed at RM1.69 last Friday, should it be a cheap entry for a small property company which has exposure/venture into overseas - Thailand, Australia and India?

Glomac Berhad

Glomac looks interesting to me after this week correction. It closed at RM1.69 this week, a pull back after it hit the highest price at RM1.81 on Tuesday.
2 major projects from Glomac - Suria Stonor and Glomac Tower set to be another milestone from the developer. Both projects will be the additional landmarks in KLCC area.

Glomac Tower


Glomac and Al Batha Real Estate Co have established Glomac Al Batha Sdn Bhd to spearhead the development of the Grade A office tower which will be located at the corner of Jalan Pinang and Jalan P.Ramlee. The 40-storey tower which includes two levels of food and beverage facilities and four basement car park levels is scheduled for construction in the first quarter of 2008.

The construction of the tower, which has an estimated gross development value of RM 450 million, will take approximately 30 months to complete and will be boost in confidence for investors from the Gulf region.

Al Batha Real Estate vice-chairman Sheikh Salem Mohammad Sultan Al-Qasimi said, he hoped the relationship with Glomac would lead to more property developments here. Glomac has a 51% stake in the joint venture.

Surio Stonor


Suria Stonor is an exclusive condominium development that combines the space and ambience of a bungalow with all the conveniences of modern living.

Located in an oasis of serenity in the heart of the city within the Stonor Enclave, Suria Stonor offers some of the most generous living spaces within the vicinity of the Kuala Lumpur City Centre. Each of its 138 freehold residences, comprising triplex penthouses, duplexes and condominiums, offers a built-up that ranges from 3,000 sq. ft to over 8,000 sq. ft.

Sales in Suria Stonor have continued to climb higher. The project is now almost 80% sold, and it is on schedule for completion in April 2008. The pricing is now about RM1,000 per square foot, which is reflective of the current pricing for high end condominiums in the vicinity of the city centre

Mah Sing - Capital Group

Filing to Bursa Malaysia shows that Capital Group has acquired Mah Sing aggressively from 5 July to 9 July. They have acquired a total of ~11mil shares during these trading days.
After the acquisition and bonus issue (1 for 5), Capital Group holds ~59mil shares of Mah Sing. The recent acquisition by Capital Group shows their confidence in Mah Sing Group?

Nextnation - Receivables

Finally, nX CEO PY Tey came out and explain the high receiables of the company. It was reported in The Star.

I have two questions:

1. If the cash flow is strong, why do they need to accept the credit facility?
2. If the likelihood of default payment was not strong, why they made provision of doubtful debts in last quarter result?

Nextnation - Revolving Project Loan of RM10mil

Announcement to Bursa Malaysia, from Nextnation shows that Nextnation has accepted a Credit Facility:

The Board of Directors of Nextnation Communication Berhad ("Nextnation" or "the Company") is pleased to announce that its wholly-owned subsidiary company, namely Nextnation Network Sdn. Bhd. ("Nextnation Network" or "the Borrower") had on 9 July 2007 accepted a Credit Facility i.e. a Revolving Project Loan of the principal amount of up to RM10.0 million only ("the Credit Facility") granted by Malaysia Debt Ventures Berhad for the Group's overseas expansion.

The Credit Facility is secured by corporate guarantee from Nextnation and the Borrower's certain assets.

Is this an indication that nX is running out of cash? Or they will be awarded a major project from overseas?

Looking at the current cash balance of the company, it is really worrying ....

YTL Land & Development

YTL Land has continued to surge higher in last week. It was opened at RM1.80 on Monday and closed at RM2.38 on Friday, the stock's 52-week high. As a reminder, HDBS has pegged YTL Land's target price at RM3.30, substantially above last Friday's closing price.


YTL Land's key landbanks include Lake Edge in Puchong, with about RM100mil GDV left; Pantai Hillpark (RM800mil GDV left and a 294-acre area in Sentul with a GDV of about RM17bil remaining.

Meanwhile, YTL Land has released the advertising 'teasers' for its d7 project, its first commercial development in Sentul East, with a GDV of about RM80mil.


HDBS forecasts YTL Land's net profit for FY2007 to be RM16.1mil, which is more than 50% lower than FY2006's net profit of RM45.9mil. However, forecasts for the company's net profit in FY2008 and FY2009 to pick up to RM55mil and RM148.3mil respectively.

Adventa Bhd

Adventa Bhd has been picked as one of the hot stocks in this The Edge.

Below are the information from The Edge:

Technical support : Long term - RM1.20; Short term - RM1.50
Technical resistance: Long term - RM3.20; Short term - RM2.10


Dealers say CEO Low Chin Guan's recent statement that the company's output of surgical gloves from several new production lines were sould out caused the counter to spike. A dealer says latecomers should take the oppurtunity to move in when the counter sees a correction.

Adventa Bhd

Adventa Bhd involves in manufacturing and distributing of healthcare products. It looks interesting according to Kenanga Research, with a target price of RM2.48 Adventa closed at RM1.70 today, add on another 7 sen.

Below are the major points from the research report:

Glove manufacturer with a difference, being only a handful of manufacturers capable of making a meaningful entry into the high end surgical glove market. First Malaysian company to be TUV certified since 1997 which can count upon reputable clients including John Hopkins Hospital of USA and large Group Purchasing Organisations;
Aggressive capacity expansion should see output rising from 2 billion pieces to 3.5 billion by FY09, a 34% CAGR increase;
High barriers to entry for the surgical glove segment, unlike the normal examination glove where requirements are demanding and qualification time consuming. Surgeons “stickiness” to a particular brand can pose a huge barrier for new aspirants. With quality and competitive pricing, the Group has been able to make successful inroad into this segment under OEM and their own brand basis;
Foray into Uruguay should bear fruits in the medium term. Cost advantages couple with the ability to provide a higher level of service to a market size of 500m in terms of population is an opportunity not to be missed. The South American production facility allows for the scaling of the tariff wall and cut short the lead time for customer order to eventual receipt of the goods; and
Compelling valuation at 6.3x FY09. Fair value of RM2.48 based on 6.5x FY09F (January year end) represent a 25% discount to the market average of 12.8x. The discount is mainly to account for its smallish size and the execution risk with its overseas forays. With increase investor familiarity and proven execution, the discount factor can and will be narrowed. Buy with an upside of 52% from the current RM1.63 level.

Lastly, Adventa has been delivering consistent quarterly financial performances as well:

Mah Sing: Premier Lifestyle Developer

Finally, Mah Sing has upgraded their website. Frankly speaking, the website prior to this upgrade was a bit lousy and did not match with the image of the company - Premier Lifestyle Developer.

Now, we can check the series of property development from Mah Sing easily in the website - Perdana, Residence, Legenda and Commercial.

Perdana


It is synonympus with well-planned lifestyle townships. The townships would be self contained yet easily accessible. Generous, well maintained central parks will become community focal points. It is priced between RM200k to RM700k.

Residence


The trend-setting Residence series will appeal to those who aspire to better living. Thoughful details in both the interiors and exteriors of the homes will be characteristics of these boutique developments. Extensive landscaping including green perimeter buffers, manicured and courtyards will add to the spacious airiness, allowing the project to blend seamlessly with nature. It is tagged between RM700k to RM1.3mil.

Legenda


The luxurious Legenda series is the elites, the creme de la creme who reward themselves with a home in a prestigious, prime location. Manicured landscaping and lush geenery creates a revitalizing ambience for wholesome living. Smart home features enhance comfort and convenience, while state of the art security features ensure tranquility unperturbed by the outside world. It starts at RM1.3mil.

Commercial


It is in prime locations in the economic hotspots of Malaysia. Grade A office building, resort offices with innovative themes to enhance new business lifestyles. Live, work and play. An irresistible investment opportunity for discerning investors.

YTL Land: d7

I saw YTL Land d7 Sentul East advertisement in this week The Edge. I went to the website and found that it is quite unique. d7 Sentul East contains duplex office, retail and F&B.


Some of the features of d7:

- cutting-edge duplex offices with exclusive bridge unites
- half sculpture, half workspace
- 10 mins to KLCC and Mont' Kiara
- 45 mins to KLIA
- next to Sentul KTM Komuter & LRT stations
- wireless broadband
- freehold

This should be the starting point of the entire development in Sentul area. YTL Land has a big plan for this area according to the research report from HDBS. YTL Land closed at RM1.80 last Friday. This represents a potential upside of 83% according to the target price set by HDBS, RM3.30.