JOIN KIM'S STOCKWATCH

https://t.me/kimstock

TO JOIN KIM'S PREMIER GROUP (KPG)

Kindly msg Kim HERE.

__________________________________________

05 June 2024

STOCK NAME : LAGENDA (7179)

LAGENDA PROPERTIES BERHAD, 

an investment holding company, engages in the property development business in Malaysia. It is also involved in building construction; property management and other business management activities; and trading of building materials and hardware products. The company was formerly known as D.B.E.

Gurney Resources Berhad. The company was incorporated in 2001 and is based in Seri Manjung, Malaysia. Lagenda Properties Berhad is a subsidiary of Lagenda Land Sdn Bhd.

KEY'S PROFILE

• Lagenda signed a shareholders’ agreement with Sime Darby Property’s wholly-owned Seed Homes to set up Seed Homes Lagenda, a 50:50 joint venture to develop affordable homes.
• Seed Homes Lagenda is set to embark on its first affordable township project in Gurun, Kedah via the acquisition of a 249-acre of land from Sime Darby Property for RM50mil.
• The estimated gross development value (GDV) is expected to be RM750mil. The project will be developed over a span of 3-4 years.
• The township is anticipated to comprise 3,000 units of single-storey terrace house, with an average selling price of not more than RM250K/unit.
• Lagenda plans to launch the first phase of this Gurun project by end of FY24 or in early 2025.
• The land price of RM50mil translates to RM4.61 psf and implies a land cost-to-GDV ratio of 6.6%, which is lower than the industry’s average land cost-to-GDV ratio of 15%-20%.
• The projected net development profit margin of 20% for the Gurun project mirrors that observed in Lagenda’s existing matured projects in Setiawan and Teluk Intan.
• Collaboration between Lagenda and Sime Darby Property, potentially allowing Lagenda to capitalise on Sime Darby Property's extensive landbank in Malaysia for further development in its affordable housing segment.
• Lagenda's ongoing township in Kedah, which includes 1,924 units, has experienced a remarkable response, attaining a take-up rate >99% for phase 1 and 2. The collaboration comes at an opportune moment to address high demand for affordable housing in Kedah.
• The company’s niche in underserved landed affordable housing developments in second-tier states with a large population of B40 and M40 income groups.

KIM'S TARGET PRICE

CP : RM1.26 (Undervalued)

TP1 : RM1.45

TP2 : RM1.65

FAIR VALUE RM2.00

KIM'S TP : RM2.20

LAGENDA-CD (Warrant) : TP 0.15c

KIM'S VIEW

• They buy the three plots of land from plantation company Hock Lean Rubber Estate Sdn Bhd to expand its land holdings and solidify the group’s position as a developer of affordable townships in Kedah.

• LAGENDA buying 855 acres of freehold land in Kuala Muda, Kedah for RM148.98 million to capitalise on the demand for affordable housing.
• The latest news is very good for company expanding their business further and future.

• This year 2024 the group poised to be a vibrant and exciting year for Lagenda as they plan to launch over 8,000 units of affordable homes, more than doubling the figure from 2023

• As of December 31,2023, the Group's unbilled sales stood at RM732.41 million, while outstanding bookings reached RM268.31 million, providing future revenue visibility.
• Beyond sales figures, the group expanded their geographic footprint in 2023, launching projects in three states: Perak, Kedah, and Johor.
• In Johor, they currently have a sizable remaining landbank of approximately 1,500 acres of land with an estimated Gross Development Value (“GDV”) of RM5.60 billion, where the group plan to launch three townships by the end of 2024.
• This expansion reflects their positive outlook on this vibrant state and the potential it holds.

• The group also believe there is vast untapped demand for affordable housing in Johor, where a significant number of households still lack homeownership.

• Additionally, they have the option to acquire another 200 acres in Johor, providing the group with flexibility and the opportunity to further expand their presence in this promising market.

• The group are ramping up to commence launches in two new states, Selangor and Pahang, expanding their presence to five states by year-end.

• This nationwide presence allows them to cater to a broader range of buyers and contribute to the housing needs of communities across Malaysia. Given these factors and barring unforeseen circumstances, the Board anticipates enhanced performance for FY2024

• Strong exposure in the affordable housing segment which is strongly aligned with the mass market demand. Demand for affordable housing, particularly units priced below RM500,000, is projected to remain resilient and is supported by various government initiatives.

• Lagenda is supported by unbilled sales of RM855 million, providing earnings visibility over the next 12 months

• Lagenda Properties rebounding in FY2024 on record-high unbilled sales, Johor expansion.

• The group's current higher confirmed sales of RM289 million, expects Lagenda's unbilled sales to climb and reach a record high of RM855.1 million, which will provide revenue visibility until 2025.

• Expects 2024 to be a vibrant and exciting year for the group, as it plans to launch over 8,000 units of affordable homes, more than doubling the figure from 2023.

• Its net profit for the fourth quarter ended Dec 31, 2023, stood at RM41.85mil, compared with RM44.65mil in the previous corresponding period. Revenue rose to RM248.09mil from RM236.07mil a year earlier.

THE LATEST UPDATE

• For the current financial quarter ended 31 March 2024, the Group recorded a revenue of RM225.62 million representing an increase of 24.7% as compared to preceding year corresponding quarter’s revenue of RM180.95 million.
• The increase of 28.3% in revenue from the property development segment was due to newly launched projects namely Darulaman Lagenda Phases 2 and 3A, BBSAP Phase 4C, Lagenda Teluk Intan Phase 3B, Lagenda Suria Phase 1A, Lagenda Aman and corresponding work done contribution from under construction projects including Lagenda Tropika, Lagenda Teluk Intan Phase 3A, BBSAP Phase 4B and Darulaman Lagenda Phase 1.

• The increase in construction revenue from RM90.72 million to RM131.88 million for the quarter under review was mainly due to above mentioned projects were in full swing of work progress.

• Revenue and the profit before tax from trading segment has increased to RM72.33 million and RM2.93 million respectively to support higher construction activities as above.

• LAGENDA, in response to an unusual market query from Bursa Securities last week, said it had become aware of news reports that the Malaysia Anti-Corruption Commission (MACC) had granted a four-day remand order involving a senior personality of the company. It said the investigation is isolated from Lagenda's business operations and that the operations of the group remained unaffected by the event.
• Former chairman Datuk Doh Tee Leong has raised his stake in the company to 57.451%, both directly and indirectly.
• Lagenda Properties said Doh acquired five (5) million shares on May 31 through Lagenda Land Sdn Bhd.
• He also acquired 1.17 million shares on the same day raising his stakes to 57.451%. He owns a direct stake of 0.141%.

​

THE PROSPECTS

• Strong start to FY2024, achieving RM 222.6 million in confirmed sales during Q1. This achievement is driven by significant contributions from Lagenda Suria in Johor and Darulaman Lagenda in Kedah, showcasing the wide appeal of our well-planned, and affordable townships.

• LAGENDA strategic groundwork for multi-state expansion is now bearing fruit, positioning us for continued growth. LAGENDA are optimistic about the latest developments planned for FY2024 and are confident that these upcoming launches solidify their position for a bright future. As of March 2024, group unbilled sales stand at a healthy RM 751.9 million, with outstanding bookings reaching RM 230.7 million, providing strong revenue visibility for the coming quarters.

• Demonstrating a commitment to nationwide growth, the group have continued to expand their geographic footprint with exciting new launches. In Q1FY2024, they have launched over 500 units with a Gross Development Value (GDV) of more than RM100 million.

• Recently in May 2024, group unveiled a brand-new township in Bernam Jaya, Selangor, marking their expansion into a fourth state. In addition, they have significantly ramped up launches in Johor. Thus far as of May 2024 across 4 states, group have launched more than 3,000 units with a combined GDV of approximately RM800 million. With plans in the pipeline to enter their fifth state, Pahang, group are on track to launch 8,000 units by the end of the year. 

• LAGENDA strategic expansions reflect their positive outlook on these states and the immense potential for affordable, well-planned housing. The group are confident that their unique blend of quality and affordability will resonate with a broad range of buyers.

• Looking ahead, the group will focus on carrying out their planned launches while executing their landbanking strategy of acquiring affordable land in strategic locations.

• LAGENDA nationwide presence will allow them to cater to a wider audience and significantly contribute to fulfilling the housing needs of communities across Malaysia.

• With their growth plans on track and a commitment to delivering high-quality affordable house, the Board of Directors anticipates FY2024 to be a fruitful year for Lagenda, barring any unforeseen circumstances.

JOIN KIM'S STOCKWATCH 

https://t.me/kimstock

TO JOIN KIM'S PREMIER GROUP (KPG)

Kindly msg Kim HERE.

Disclaimers: The research, information and financial opinions expressed in this article are purely for information and educational purpose only. We do not make any recommendation for the intention of trading purposes nor is it an advice to trade. Although best efforts are made to ensure that all information is accurate and up to date, occasionally errors and misprints may occur which are unintentional. It would help if you did not rely upon the material and information. We will not be liable for any false, inaccurate, incomplete information and losses or damages suffered from your action. It would be best if you did your own research to make your personal investment decisions wisely or consult your investment advise.