RHB Research

Tambun Indah Land - Keeping The Growth Momentum

kiasutrader
Publish date: Wed, 20 Nov 2013, 09:40 AM

TILB’s 3Q13 results beat  our expectation. A 2 sen interim dividend was declared. New property sales for 9M13 reached MYR449m vs. MYR343m in  1H13.  Given  the strong  results  and  the  expected  completion of  the minority stake acquisition in Pearl City  by end-November, we raise our FY13  earnings  forecast  by  11%.  We  remain  confident  that  the  strong sales momentum will continue given Pearl City’s buyer profile. BUY.

  • Positive earnings surprise.  Tambun Indah  (TILB)’s  3Q13 results came in  above  our  expectations  on  an  annualised  basis.  The  Pearl  City township  contributed  about  72.3%  of  the  total  property  development turnover during  the quarter.  An interim  single-tier  dividend  of 2 sen  was also declared.
  • New  sales  continue  to  climb.  9M13  new  sales  reached  MYR448.6m from  MYR343m  (+31%)  in  1H13.  Apart  from  Pearl  Residence (MYR146m),  which  was  the  largest  contributor,  Straits  Garden  condo (MYR89m), Pearl  Impian terraces (MYR73.1m), and Pearl  Avenue shop lots  (MYR61.7m) also made up the new sales in 3Q.  The average takeup rate  for all projects  hit a new high of 81.1% vs  73.3%  in 1H.  Going forward,  despite the cooling measures, we expect  the  sales momentum to continue as we reiterate that  demand for properties in Pearl City and Penang  mainland  is  largely  driven  by  genuine  buyers  (for  owner occupancy purpose) and rising job opportunities.
  • Forecasts.  In  view  of  the  group’s  strong  results  and  profit  margin,  we raise our earnings forecasts by 11% for FY13 and 4% for FY14. Unbilled sales  now stand at  MYR518m from  MYR510m in the previous quarter.The  acquisition  of  the  minority  stake  in  Pearl  City  is  expected  to  be completed by end-November. Therefore, the corporate exercise will have about one-month impact on TILB’s FY13 earnings.
  • Maintain Buy. Our FV is kept at MYR2.05, based on an unchanged 15% discount  to RNAV.  While the sector is currently  not in favour due to the negative  impact  of  the  cooling  measures,  our  stock  pick  is  selective.TILB  remains  one  of  our  Top  Picks  for  the  sector  given  its  strong fundamentals,  above  sector-average  earnings  growth,  virtually  zero exposure  to  foreign  purchasers,  as  well  as  catalytic  angle  from  the upcoming opening of the Penang Second Bridge (PSB). Maintain BUY.

Financial Exhibits

SWOT Analysis

Company Profile
Tambun Indah Land Bhd is a developer based in Penang mainland. Its flagship township Pearl City is loca ted at Simpang Empat, 15-minutes away from the PSB.

Recommendation Chart

Source: RHB

Related Stocks
Market Buzz
Discussions
Be the first to like this. Showing 0 of 0 comments

Post a Comment