Posted by snowball2000 > 2022-05-26 17:06 | Report Abuse

The company is really strange. Major shareholder pumped in a lot of money but not much activity. Interest charged is high compared to the level of activity. Newbie here, can someone please enlighten?

Posted by Val-Elta > 2022-05-26 17:42 | Report Abuse

Hi snowball, to be honest, you'll be looking at a good result for MCT in the 4th quarter results, this next 6 months, the results will be so so only.

Please verify on your own, what is said.

To answer you, interest cost, this is due to the loan MCT took from Ayala in 2018/2019 like that, around 120m++ USD, interest rate around 6%, that's why every year need to pay ~32million in interest.

Why so much loan (500+m MYR) vs low level of sales, I believe they used the money to rush out the completion of projects back then, after those projects were completed around 2020 (When MCT recorded one of their higher profits) of course Covid comes, and it effected their new launches, imagine if without covid, Aetas and Alira were launched 1 year earlier, and at this time, the revenue from these two projects (or more projects) would be just nice to cover the interest and generated profits.

Worst of all, after the intercompany loan is approved, goverment implemented taxation on intercompany loans, whereby, interest paid to controlling shareholders is not tax deductible expense. Again, got hit not only by interest, you'll also got hit by taxation as well. MCT's tax rate is insanely high... 30 to 40% ish? I didn't really verify the exact percentages for you...

That's the bad news, but having said all of that, this is where the better news is coming in.

If you check 2020 Annual Report, their unbilled sales is ~RM 320m
If you check the 2021 Annual Report, (EVEN AFTER BILLING minus RM 320m sales), they still have UNBILLED SALES of RM 510m!

Basically, in the year 2021, with covid, with lockdown, MCT sold RM 510m of new homes! Impressive numbers...

This RM 510m sales is from Aetas, Alira, Casa Bayu, which for aetas and alira, is only in the unbillable constructions stage unfortunately. Aetas will hit their residential unit construction in the 3rd quarter, while Alira probably will bill the first 10% in December (assuming foundation works takes a year)

Back to your interest topic, the MYR 500m + loan this figure have moved from Long Term Liability to Short Term Liability in Dec 2021 QR, which means, yes, this pain in the ass Loan/Interest/Tax payment will be replaced with local banking borrowings, that is more realistic with the current activity level, and at a lower interest rate amount as well.

Yes, like that loh, if you're entering now, it's really a good good point to enter, Net Asset 50+ cents, but, please, do prepare to hold up to minimum 6, ideally 9 months for this investment to turn around :(

I wouldn't want you to buy and cut loss in the next 1 to 3 months.
Myself also in the boat, and plan to see it through til year end.

Posted by Val-Elta > 2022-05-26 17:50 | Report Abuse

Oh ya, forgot to mention, in 2021, MCT loss about MYR 22 million to their construction subsidiary, (Remember, MCT used to have their own in house construction team) to build their projects before 2020.

Again, this is where the good news comes in, MCT have since fully sub contract construction works out, so, YoY, it's not likely to incur the -22m loss from their construction department.

So, that's the frank story of MCT, good entry if you have the patience, or if you can accumulate on a monthly basis until their year end.

But again, will subject to near term risks for the next 6 to 9 months :(

Posted by snowball2000 > 2022-07-05 10:01 | Report Abuse

TQ Val-Elta for the detailed and good analysis..

Posted by Val-Elta > 2022-07-07 16:45 | Report Abuse

Some update, profit for upcoming quarter maybe very good... Depending on VP payment and progress billing if can bill in 2nd or 3rd quarter ...

If you're reading this and you're shareholder already, the price now is at 2020 March low, during MCO 1.0 announcement.. are things really as bad as that period? No right, I hope existing shareholders don't sell at this bottom.

If you're reading this to buy, again can use same assessment, are we really at the most fearful period in mco 1 announcement back in March 2020? It is really heavily oversold...

MCT unbilled sales have increased up to 520m as officially announced in last AR.

It's possible that unbilled sales could reach up to 600m already now, with Alira sales around 80% already, Aetas is 70% sold while Casabayu is 65% sold.

Amongst property developers MCT actually have around 4million of completed and unsold properties! At 500k per house, that means 8 units of unsold home only ....

There is a lot of good value for buyers, while for existing shareholders, do try to hold until the upcoming q result if possible, just 1 and half month more to go only.

Posted by koyokui > 2022-07-22 09:18 | Report Abuse

Buy mct volume up

Posted by koyokui > 2022-08-09 14:46 | Report Abuse

Somebody need to push up

Posted by daneilchoong > 2022-08-24 08:47 | Report Abuse

mct target 20 sen

Posted by Val-Elta > 2022-08-24 22:57 | Report Abuse

QR Update.
Expectations vs Reality, overall original assessment in May still remains, we're looking at the 3rd and 4th quarter result for higher revenue, and eventually lower interest paid and lower taxation (from unclaimable interest expense) to kick in. 1st Q of 2023 onwards should be able to maintain profitable quarters consistently, provided their target of successfully launching 2 projects per year is achieved.

Cons
VP progress billing for market homes missed to be billed in Q2.

Pros
Overall, QoQ improved, and loss narrowed from 11m to 4m

For earnings visibility
Missing the VP billing for lakefront in June quarter is a negative, but it means that 3rd Q result will be good, potentially around 110m in revenue.

4th quarter earnings will depend upon Aetas and Casa Bayu progress billing maybe Alira phase 2 foundation billing.

Risks
Construction workers, and building material increase, market uncertainty in the next 3 months, opportunity costs.

Posted by Val-Elta > 2022-08-24 22:59 | Report Abuse

Overall, current price risk to reward ratio does favor the buyer, but low liquidity and buying interest makes it hard for shareholder to exit quickly, without selling at a steeper discount.

Posted by daneilchoong > 2022-08-25 14:52 | Report Abuse

buy indeks up 24 point all up

Posted by daneilchoong > 2022-08-25 18:55 | Report Abuse

28 point bull coming this time

Posted by koyokui > 2022-09-05 15:50 | Report Abuse

Buy mct nta still very high of 58sen

Posted by koyokui > 2022-09-13 17:47 | Report Abuse

Mct time to go up tp 13 sen

Posted by leedavid > 2022-09-19 07:59 | Report Abuse

mct goreng today

Posted by leedavid > 2022-09-28 08:52 | Report Abuse

mct spike

Posted by leedavid > 2022-09-29 08:02 | Report Abuse

nta still high

Posted by leedavid > 2022-10-11 08:14 | Report Abuse

buy buy pru coming

Posted by Val-Elta > 2022-10-11 09:14 | Report Abuse

Very good value and low risk to reward ratio for those who are able to buy now.
Whoever is selling, is certainly selling at losses now.

Fundamentally, MCT have over 700m in unbilled sales just from their 3 ongoing projects of Aetas, Alira and Casa Bayu.

Their new launches, Casa Embun Phase 1 booking seems positive and should be successfully launched, providing a good continuous earning visibility.

Posted by Val-Elta > 2022-10-11 14:01 | Report Abuse

Low liquidity is still an ongoing issue, if you buy, make sure to have holding power for a month and a half onwards, despite good net assets and the company turning back to profitability from the coming quarter result.

Financially, 3rd Q result coming in a month and half time, should continue to improve, supported by lakefront homes vacant possession revenue recognition of ~ 90 million, + additional progress billings from casa bayu, park place, all in, revenue could be between 110 to 130 million.

In the 4th q, while the 110m++ earnings will not be sustainable, mct should still be profitable, due to Aetas will be in a almost full quarter of revenue generating period, with construction progress already reaching the 4th floor of residential units for tower 2 as of 1st week in October. while tower 1 residential units will start to be built in October too. Balance sheet wise, borrowings should drop to 150m to 200m from the 550m loan from holding co, and interest charges will also reduce by 3 to 4m per quarter moving onwards. Accordingly, income tax is also expected to be lower as well by 1 to 2m.

After which, the future next 4 quarter of performance of mct will be supported by continuos progress billings of casa bayu, aetas and Alira which have both recorded up to ~ 75% sales overall. Any new launches (casa Embun, sanderling or Narra) in this last 3 months will continue to provide consistent income visibility for FYE2023

Posted by Val-Elta > 2022-10-13 09:24 | Report Abuse

MCT really need to improve their IR... (which to be fair, they have been improving)

Persona Metro, another public listed company just announced construction contract awarded to begin construction on 25th October of sanderling lakefront project. This usually means the project has at least 30% SPA signed.

Surprisingly, pilling works seems to have been completed as well? Construction period of 24 months seems too short if foundation works has not been started (Usually pilling and foundation works will take 9 to 12 months of entire development time)

Unbilled sales is potentially around 800 million now. (700m from Aetas, Alira, Casa Bayu + 30% of Sanderling GDV ~100m), income visibility for the next two years is be very consistent now.

But again, very low visibility of the counter to retail investors, and buying volume is very weak. Share price is exposed to price drop when existing shareholders need to exit in short term. Buy only if you have holding power of 2 months++ otherwise you will need to cut and sell at a loss.

Posted by koyokui > 2022-10-20 20:29 | Report Abuse

Market bull now

Posted by leedavid > 2022-10-21 09:38 | Report Abuse

mct good

Posted by leedavid > 2022-10-26 08:03 | Report Abuse

dow jones up all up

Posted by nemesis > 2022-12-01 17:57 | Report Abuse

Ramping up today...Quarterly Fin Results improved and total unbilled sales should be around 800 mil now which provide earning visibility for next 2 years to come...if annual EPS can maintain at 5 sen per share moving fwd, then MCT should worth at least 0.30...Deeply undervalued now!

Posted by Val-Elta > 2022-12-15 19:10 | Report Abuse

Yes agreed that it's deeply undervalued in the 3 to 9 months, but I feel even 3 months also seems like a very long time frame and some may cut loss or take early profit.

Have not really seen MCT billing their recently VP-ed project in Lakefront.... Or maybe they split the invoicing across two quarters? There's still a potential for a bumper profit in the upcoming QR as the VP billable amount for their recently handed over project could worth up to 80, 90 million just by itself.

Other than that, their interest charges should drop by 6 to 7 million like that as well. With the repayment of their 560m loan from holding co.

Taxation should normalize too after that.

Their OneCity project also is reviving in terms of office and shop lots rental, with their carpark rental being well occupied too.

They still have an uncompleted mall and tower 4 in skypark cyberjaya. This building is just opposite of MRT station which will open in Jan 2023... If tower 5 and 6 receives good occupancy, tower 4 will benefit from revaluation and potential rental income as well.

For myself, most of the negatives and stormy seas have already been sailed through, hope existing shareholders don't sell so soon....

Posted by elunmask8 > 2022-12-19 12:26 | Report Abuse

I smells good offer here. Will add on to my portfolio to further enhance values!

Posted by Michael R. > 2023-01-27 15:36 | Report Abuse

0.20 anytime!!!

Posted by rohank71 > 2023-02-05 19:38 | Report Abuse

when 20 Sen?

Posted by nemesis > 2023-02-23 10:18 | Report Abuse

Comingggggggggggg!!!

Posted by George99 > 2023-03-01 12:46 | Report Abuse

Project dah banyak. Tanah pun semakin byk.... Bila limit up pula... Duk tunggu ni.....

Posted by elunmask8 > 2023-03-01 13:32 | Report Abuse

Since my posting 2 months ago...the price has shot up and base on its NTA of almost 60 sen per share, trust that the upside still have lots of legs to be up up and flying high very soon.

Am sure that the landbank or their stocks of completed houses are worth a lot more now at the current post pandemic price.

Posted by George99 > 2023-03-01 15:27 | Report Abuse

not up up only
Limit up.. limit up... Ya

Posted by snowball2000 > 2023-03-01 19:01 | Report Abuse

https://www.bursamalaysia.com/market_information/announcements/company_announcement/announcement_details?ann_id=3333505

Posted by Val-Elta > 2023-03-01 23:37 | Report Abuse

Don't want to say too much anymore, but as usual, if you're a shareholder, do try to wait until annual report is out in 2 months time, after which will have more visibility into their sales.

To be honest, I wasn't expecting such an aggressive land acquisitions so fast, and they are doing high end developments as well.

If want to be positive, these land purchases can be taken as a sign that they have sold out or close to selling out all their launches, to be fair to them as well, their last two lands purchased from Tropicana seems to be successfully launched as well.

Hope for the best and see you all after the next QR announcement

Posted by George99 > 2023-03-02 09:44 | Report Abuse

up up up


Limit up limit up...

Posted by rohank71 > 2023-03-08 10:27 | Report Abuse

may be privatise plan again.

Posted by snowball2000 > 2023-03-08 11:53 | Report Abuse

This is still early days. If the recent land purchases are an indication, 0.20/share is still too cheap, given the nta of 0.598/share as of 31/12/2022.

Posted by snowball2000 > 2023-03-08 11:59 | Report Abuse

Seems like a lot of retail investors are taking profit now...

Posted by Val-Elta > 2023-03-09 09:50 | Report Abuse

Wasn't expecting the buying volume suddenly.

It's a bit hard to estimate the fair value at this moment for MCT, especially since
1) the company just started to turnaround (from a profitability/EPS perspective, if based on yearly EPS of 4 cents, PE 10 worth 40 cents)
2) Fundamental change, historical prices of 10, 12, 14 cents is now totally invalid as a reference, due to change from loss making to profit making
3) if based on NAPS, of course, it's ~60 cents
4) Today's OPR result may be supportive of Property counters if rate maintained.
5) 720m unbilled sales at Dec 2022 is a record 4 years high? You will need to go back to AR 2018, for unbilled sales of 814m
6) Overall, the property index is also running up, maybe there's a wider property sector interest too

I think just based on the above which is fact, TP of even 30 cents is reasonable for the next 3 to 6 months. In this period, a few events will add further support to the 30 cents+ TP, Casa Embun and Alora sales/reception, progress billing for current projects etc.

For the immediate 1 week to 2 months, a lot will depend on the new buyers now, do they stay for a longer period or they are happy to take small profit, or worst, cut loss.

Posted by Val-Elta > 2023-03-09 10:10 | Report Abuse

let's see if it can be supported at around 18 to 20 cent for these next 2 to 8 weeks, and we'll have AR released then that'll offer more visibility/aid in our decision making.

Posted by TCH1186 > 2023-03-09 21:01 | Report Abuse

Good or no good?

Posted by Madjin Gun > 2023-03-20 09:48 | Report Abuse

Today will break 0.185 resistance

Posted by Madjin Gun > 2023-03-21 19:37 | Report Abuse

Sleepy stock zzz

Posted by Madjin Gun > 2023-03-23 10:46 | Report Abuse

Jerung sudah masuk

Posted by Moneyking543 > 2023-03-23 11:54 | Report Abuse

jerung akan telan orang yang suka bermimpi...hahaha

Posted by Madjin Gun > 2023-03-23 12:52 | Report Abuse

Swim with the shark, if you know what I mean

Posted by Moneyking543 > 2023-03-23 13:09 | Report Abuse

jerung = buaya

Posted by George99 > 2023-03-24 09:07 | Report Abuse

Up...up....up......

Posted by Val-Elta > 2023-05-30 18:58 | Report Abuse

Post qr results update

EPS suffered due to ~4m higher than average direct & admin fees.

However, unbilled sales is at 790 million as of 31st Match.
This amount of unbilled sales is higher than Lagenda Property for comparison.

As all of MCTs projects is entering billable stages, it's possible for their upcoming quarterly revenue recognition to be at 100m, with 33% of gross margin. 33m gross profit.

Deducting 17m in direct operating expenses, 16m profit before tax and 12m profit after tax is possible.

Entering oversold territory, comparing against other property counters, MCT have much more in terms of earning visibility, net asset per shares but is trading at much lower share price.