INVESTMENT HIGHLIGHTS

• Acquiring Titiwangsa land for RM60m

• Valuation is fair in our view

• Positive on the news

• Earnings estimate maintained

• Maintain NEUTRAL with higher TP of RM1.59

Acquiring Titiwangsa land for RM60m. Mah Sing Group Berhad (MAHSING) has entered into agreement to acquire 3.56 acres of freehold land in Titiwangsa, KL (along Jalan Beserah off Jalan Tun Razak). We gather that MAHSING plans to develop condominiums with indicative built up from 850sqft (priced from RM485,000) with total GDV of up to RM650m.

Fair valuation. Valuation works out to be RM387 per sq ft which is fair in our view as it is within the surrounding area value of above RM400 per sq ft. The land is located 3.7km away from Kuala Lumpur City Centre and the Petronas Twin Towers. It is zoned for residential development and fronts Titiwangsa Lake Garden. The land is ~250m away from the upcoming Hospital KL MRT Station and 1.8km away from the existing Titiwangsa LRT, monorail and MRT interchange.

Positive on the news. We are positive on the news as we believe that the strategic location of the landbank with price at an affordable price (from RM485,000 onwards) should translate into good take up rate. The land purchase is estimated to be RNAV accretive and hence should result in enhancement of shareholder value.

Earnings estimate maintained. As we expect the project launch only in FY2018, we expect earnings to start to kick in only from FY19 onwards. Hence, we maintain our earnings forecast for FY17 and FY18.

Maintain NEUTRAL with higher TP of RM1.59: Our Target Price has been increased to RM1.59 (from RM1.57) after including Titiwangsa land into our RNAV. Valuation method is unchanged based on 25% discount to RNAV

Source: MIDF Research - 18 May 2017