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Property In Focus: Renewed Interest In Property Stocks?

Extract from The Edge (01/09/10)

KUALA LUMPUR: Property has long been known as the laggard sector, the market underperformer, and investors would typically only flock to property and property stocks after a rally in the stock market.

However, does this still hold true in today’s ever-changing environment? Could property stocks be due for a comeback in the near future?

“Property companies are reporting solid revenues, margins and profits. There is no reason for these not to be reflected in their share prices,” said an analyst, noting that the property market was doing well and yet most property stocks were trading well below their historical book value, and on single-digit earnings multiples.

However, the main concerns are the accounting standards — IFRIC 15: Agreements for the Construction of Real Estate and FRS 111: Construction Contracts — which call for a delay in revenue recognition until the construction completion date.


Property In Focus: Sunrise Expanding Beyond Mont’Kiara

Extract from The Edge (01/09/10)

KUALA LUMPUR: From March 23, 2010 to Aug 9, 2010, Sunrise Bhd executive chairman Datuk Tong Kooi Ong acquired a total of 2.15 million shares, boosting his total direct and indirect stake in the company to 121.89 million shares, or 24.6%, according to filings with Bursa Malaysia.

Sunrise’s shares have fallen 3.4% year-to-date, compared to a 11.8% rise for the FBM KLCI.

At Monday’s close of RM1.99, the stock is trading at half its recent peak of RM3.85 in July 2007.

Its shares are also trading 10% below their net assets per share of RM2.21 as at June 30, 2010, and on 7.4 times trailing FY10 earnings (for financial year ended June 30, 2010).


Property In Focus: Selangor Dredging’s Teh Raises Stake Aggressively

Extract from The Edge (01/09/10)

SELANGOR Dredging Bhd’s managing director Teh Lip Kim had started buying more of her company’s shares very aggressively since July.

From July until Aug 25, she acquired a total of 4.45 million shares. She now has a total direct and indirect stake of 228.84 million shares, or 53.9% of the company.

As at Monday’s close of 67.5 sen, Selangor Dredging’s shares are trading at a steep discount to their net asset per share of RM1.20 as at June 30, 2010. For the first quarter ended June 30, 2010 (FY11), the company posted a net profit of RM5.69 million, or 1.34 sen per share.

The stock rose to its 52-week intra-day high of 77.5 sen on Aug 18, 2010, up from the low of 51.5 sen on April 30, 2010.


Property In Focus: YNH Off Radar Since Aborted Sale Of Menara YNH To KFH

Extract from The Edge (01/09/10)

OVER at YNH Property Bhd, the controlling Yu brothers have also been increasing their stakes rather aggressively.

Chairman Datuk Dr Yu Kuan Chon and managing director Datuk Yu Kuan Huat acquired a total of 6.112 million shares this year until Aug 23, bringing their total direct and indirect stake to 128.602 million and 128.469 million shares, respectively, or a 32.1% stake.

YNH Property, formerly a favourite among analysts and fund managers, fell off the radar after the proposed sale of its benchmark-setting Menara YNH project in Jalan Sultan Ismail, Kuala Lumpur, to Kuwait Finance House (KFH) was called off.

The company’s net profit for the three months ended June 30, 2010 came in at RM16.03 million, up 3.8% year-on-year and 8.6% quarter-on-quarter. For the half year, the company reported a net profit of RM30.79 million, or 7.72 sen per share.


Property In Focus: Property Sector An Overweight Subject To Review

Extract from The Edge (01/09/10)

The KL Property Index lost 1.2% in August despite the benchmark FBM KLCI gaining 3.7%, trimming some gains seen in the preceding month.

Despite the overall negative bias in the property market seen during the month, Bandar Raya Development was up 20.5% in August (52.5% YTD) amid talks of a Chinese party acquiring its 57% stake in loss-making Mieco Chipboard.

Talk of potential privatization of the property developer also buoyed investors’ sentiment on the stock.

On major shareholding changes among stocks under coverage, Employees Provident Fund turned net seller of S P Setia Bhd and Sunrise Bhd with 1.9 million and 2.3 million shares transacted respectively. Nonetheless, controlling shareholders of Sunrise, YNH Property and Glomac continued to accumulate shares in the market.


Naim Seeks Bumiputra Property Partner In Sabah

Extract from The Star (01/09/10)

KUCHING: Naim Holdings Bhd is actively seeking a bumiputra partner in Sabah where it plans to expand its property development and construction business.

Corporate services and human resource senior director Ricky Kho said the partnership could be a joint venture or other types of collaboration.

“Naim has serious talks with several Sabah landowners to develop their land on a joint-venture basis but nothing concrete has come out from such discussions. We have carried out feasibility studies on several localities there for property development. It is important to find the right development areas and partner(s),’’ he told StarBiz on Monday.

Kho said the company had the financial muscle to acquire up to 400ha for property development.


PKNS To Enter REIT Industry

Extract from The Star (31/08/10)

PETALING JAYA: Selangor State Development Corp (PKNS) will be signing a series of agreements to mark its entry into the real estate investment trust (REIT) industry.

The signing ceremony is scheduled for Thursday. PKNS’ prime properties will be put under the PKNS REIT.

News of the company’s plan to go into the REIT business emerged last year but attempts by StarBiz to gain more information from PKNS were unfruitful.

Reports earlier had stated that PKNS was negotiating to buy a controlling stake in a listed REIT with total assets worth more than RM600mil. Its general manager, Othman Omar, declined to name the REIT.


Axis-REIT In Talks To Buy Stake In Philippine Firms

Extract from Business Times (01/09/10)

AXIS-REIT Managers Bhd is looking into expanding its real estate investment trust (REIT) business by acquiring a stake in a future REIT manager in the Philippines.

"We are in discussions with a party in Manila to take an equity position and assist in the management of its future listed REIT," Axis-REIT chief executive officer Stewart LaBrooy told Business Times.

LaBrooy was asked to comment on online reports in the Philippines last month that Axis-REIT is scouting for investment opportunities in the Philippines.

According to reports, overseas REIT investment firms, including Axis-REIT, are turning their radar to the Philippines following the recent approval of the respective REIT rules by the Securities Exchange Commission and the Philippine Stock Exchange. Unfortunately, LaBrooy said there are delays in publishing the implementing rules, which will prolong the launch of any new REITS in the Philippines.


Amphill Bullish On Ampang Condo Project

Extract from Business Times (01/09/10)

AMPHILL Development Sdn Bhd will launch a boutique residential project worth RM200 million within Ampang’s embassy row in Kuala Lumpur by early next year.

The 0.44ha project will feature luxury condominiums, each with average built-up of 4,000 sq ft.

Amphill founder Poh Pai Kong is bullish on sales as he is targeting international investors and well-heeled local owner-occupiers.

Poh said because of this positioning, the design, finishes, fittings, management and after-sales service would be “tip-top”. A team of top-notch consultants are working on the design details.


UEM Land Plans RM4.5b Developments

Extract from Business Times (01/09/10)

UEM Land Holdings Bhd said it was planning to launch three residential projects worth over RM4.5 billion in phases starting from the end of this year.

The projects are Nusa Bayu, a 103ha mixed-residential development worth RM700 million and a 35-storey residences and 20-storey commercial tower on 1.3ha fronting Puteri Harbour, a waterfront development.

UEM Land managing director and chief executive officer Datuk Wan Abdullah Wan Ibrahim said in an interview with Business Times recently that the estimated gross development value (GDV) for the residences and commercial tower, including two building currently under construction, is RM387.9 million.

Nusa Bayu will offer 4,942 double-storey terraced homes, shophouses, and medium- to low-cost apartments. Some 673 units will be launched this year. Its most expensive project is Northern Estuary, a 154ha high-end, low density and sustained eco-living residential development worth RM3.5 billion.