INVESTMENT HIGHLIGHTS

• Take up rate for tower A & B of MVertica at 70%

• Property launches plan for FY18 intact

• Sales target maintained at RM1.8b

• Maintain BUY with unchanged TP of RM1.60

We recently met up with Mah Sing Group Berhad (Mah Sing) management. We have also visited sales gallery of M Vertica in Cheras. We came away feeling affirmed on the prospect of Mah Sing. The key takeaways from the visit are as below:

Take up rate for tower A & B of MVertica at 70%. Mah Sing officially launched M Vertica in February 2018. Note that M Vertica is a mixed development project in Cheras with a total GDV of RM2.2b. M Vertica is one of Mah Sing’s key affordable homes projects in Klang Valley. The project comprised 3,684 units of serviced apartments spread over five high-rise towers. The units have built-up areas for 850sf to 1000sf with selling prices start from RM450,000. Mah Sing launched two towers (tower A&B) out of five towers while take up rate is estimated at 85%. Looking forward, Mah Sing plans to launch third tower in Oct/Nov. On another note, M Centura in Sentul, which is another key affordable home project of Mah Sing recorded take up rate of 71%.

Property launches plan for FY18 intact. Mah Sing maintains its property launches plan of RM2.2b for FY18. Note that Mah Sing launched projects with total GDV of RM760m in 1QFY18 while there were no new project launches in 2QFY18. Nevertheless, Mah Sing is looking to speed up property launches in 3Q and 4Q to catch up with its total launches target of RM2.2b GDV. Key upcoming launches in 2018 include M Centura, M Vertica, Sensa Residence and Cerrado Residential Suites in Southville City.

Sales target maintained at RM1.8b. Mah Sing is maintaining its new property sales target of RM1.8b for FY18. Note that Mah Sing recorded new property sales of RM470m in 1QFY18 which made up 26% of our and management sales target of RM1.8b. New sales in 2QFY18 are expected to be supported by its marketing campaign “Desire” which was launched in May 2018. The campaign offers a variety of packages for buyers looking for ready-to-move-in homes with hassle free home ownership. The campaign was offered only for a selection of completed homes and commercial projects.

Source: MIDF Research - 31 Jul 2018