Share Price Performance Buoyed by Superior Performance and  Special Dividend

During the current year-to-date period, PCB's share price has outperformed the FBMKLI index and the KLPRP index by 20% and 7%, respectively – see  Figure 1. This remarkable price gain is likely attributable to its strong FY22  performance and the March 29 payment date for a special dividend.

To recap, PCB's new property sales increased by 37% YoY to RM1.1bn in FY22,  driven by a record number of launches worth RM1.2bn. It is noteworthy that  PCB's sales in FY22 were the highest ever, surpassing the previous record set in 2018, while also exceeding its sales target of RM1.0bn. PCB has also achieved a new milestone with unbilled sales of RM1.4bn. Despite the share price declining slightly following the 12sen/share special dividend going ex on March  17, we are of the opinion that the group still has the potential to ascend to greater heights, underpinned by various growth strategies aimed at enhancing the group's business moving forward.

Confident of Achieving RM1.2bn Sales Target

Management is optimistic about the market outlook and has set a higher sales target of RM1.2bn for FY23. This is supported by seven new launches, including new phases of existing projects, with an estimated gross development value of  RM1.5bn, as well as other ongoing projects - as illustrated in Figure 2 & 3.  Based on the positive response to recent launches, the management is confident that the sales target will be achieved. Despite the hikes in OPR, we understand that the sales momentum for the first two months of the year has been encouraging.

This year, PCB is planning to expand its business in the industrial property segment in the north, in addition to residential products. Paramount Palmera, a  freehold light industrial development in central Seberang Perai, is due to be launched in 1H23 in response to the increased demand. Paramount Palmera accounts for 11% of the RM1.5bn launch target this year, with a potential gross development value of RM157mn over a development period of 3 years. The strategic location of Paramount Palmera near Jalan Permatang Tinggi, in the vicinity of the established industrial address of Bukit Minyak, enhances its appeal.

Source: TA Research - 27 Mar 2023