KLSE (MYR): IOIPG (5249)
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Good123
26,680 posts
Posted by Good123 > 2019-09-03 15:06 | Report Abuse
No wonder epf buying nonstop
IOI Properties following share price fall, says RHB
BUSINESS
Monday, 22 Apr 2019 1:07 AM MYT
KUALA LUMPUR: Value has emerged in IOI Properties Bhd following the 15% to 20% drop in its share price over the last three months, says RHB research.
The research house upgraded the counter to buy from neutral with an unchanged target price of RM1.76.
In a note, it said it met with IOI Properties' management, which suggested that there was no material explanation for the fall in the share price.
The group's most recent launch in Xiamen 2 in December 2018 was over 80% sold. In FY19 so far, the group has launched over RM400mil of projects in China, which have been well received.
Meanwhile, management is looking to roll out the Xiamen 3 project in Xiang An in mid-2019 if the market is ready for the pricing and product.
RHB added that the group stands to be a beneficiary of the ECRL line and potentially the High Speed Rail (HSR) project if revived.
"With about 700 acres of development land around IOI Resort City, we think IOI Properties is a prime beneficiary of the railway network that will have a stop at Putrajaya Sentral.
"These are the ECRL, ERL, and MRT2 (Sungai Buloh-Serdang-Putrajaya line) that have already been allocated a stop at Putrajaya Sentral, which is 11-12 km away from the site," it said.
Assuming the HSR project is revived, the link could potentially have a stop at Putrajaya Sentral while IOI Properties owns more than 1,000 acres of land directly opposite the Ayer Keroh HSR station as per the original plan.
Near-term earnings growth should also be backed by IOI Properties' investment property assets, which make up over 20% of its total revenue, as compared to about 10% two years ago.
IOI Properties is currently constructing Phase 2 of IOI City Mall, which should have a net lettable area of one million sq ft to be completed in 2021/22.
RHB added that the development's average rental has hit about RM10 psf compared to RM7.50-8 psf during its inception.