Translate This Page

Malaysia Bank Swift Code

What is Swift code? Swift code is known as ISO 9362 and is a standard format of Bank Identifier Codes approved by the International Organiza...

Thursday, April 20, 2017

Upgrade to OUTPERFORM with a higher target price (TP) to RM1.31 from RM1.23


 

Yesterday, HUAYANG announced that it will be acquiring another 20.1% stake in Magna Prima Bhd for a cash consideration of RM123.8m, effectively raising their stake to 30.9%, as part of their land banking strategy, of which we are mildly positive due to MAGNA’s strategic land banks in Klang Valley. No changes in FY17-18E earnings. Upgrade to OUTPERFORM with a higher Target Price of RM1.31 (from RM1.23) on a higher RNAV of RM3.05 with an unchanged discount factor of 57%.
News. 

Yesterday, HUAYANG announced that they will be acquiring another 20.1% stake in Magna Prima Bhd (MAGNA) for a cash consideration of RM123.8m - indicating RM1.85/share (same price as previous acquisition) effectively raising its stake to 30.9%. The acquisition will be funded through HUAYANG’s internally generated funds, and the exercise is expected to be completed by 2Q17 should there are no objections from its EGM.

Not a surprise. We are not surprised with HUAYANG’s move in raising its effective stake MAGNA to 30.9% as we have previously mentioned this in our previous report dated 26th January 2017. Following the acquisition on the additional 20.1% stake, we expect its 9M17 net gearing of 0.32x to increase to 0.66x which still falls within management’s comfort level. However, there will not be any mandatory general offer on MAGNA from HUAYANG as it is still below 33.0%.

Strategy forward… This allows HUAYANG to extend its reach in Klang Valley by tapping into the potential of MAGNA’s strategic land bank, which measures c.35 acre with a potential GDV of RM1.6b which is located in Shah Alam. That said, they are also able to come up with a collaborative agreement to engage similar resources, while future identified land bank would be jointly developed on 50:50 basis.

Outlook. HUAYANG’s move on MAGNA has further reinforced our view that there would not be any land banking activities in the near term and dividends to be kept at a minimal level as highlighted. However, we are mildly positive on the deal as it will give them the opportunity to replenish their land bank in Klang Valley by undertaking the development of MAGNA’s land bank that is located right at KLCC (2.6ac), Seksyen 15, Shah Alam (20ac), and we do not rule out any potential M&A play in the future.

Earnings unchanged. No changes to our FY17-18E earnings at this juncture as we are still in the process of ascertaining MAGNA’s future earnings. For illustrative purpose, assuming that MAGNA is able to replicate its net profit of RM44.8m in FY16, it could potentially contribute an additional 20% income to HUAYANG’s FY17E earnings. Its unbilled sales of RM215.6m only provide visibility for the next two quarters.

Upgrade to OUTPERFORM. Following the announcement, we are upgrading the stock to OP from our previous MP call with a higher Target Price of RM1.31 based on unchanged 57% discount (near trough valuation) to a higher RNAV of RM3.05 (from RM2.83) after factoring the additional 20.1% stake of MAGNA into our RNAV. Our new TP implies FY17-18E PERs of 6.7x-7.6x, which is still lower compared to its smallmid cap peers average of 8.5x-7.5x.

Risks to our call includes: (i) Weaker-than-expected sales, (ii) Higherthan-expected administrative costs, (iii) Negative real estate policies, (iv) Tighter lending environments, and (v) Lower-than-expected dividend pay-out.



Source: Kenanga Research - 20 April 2017

No comments:

Post a Comment

Labels

Investment News share market bursa malaysia FBM KLCI market daily report stock stock market Brokers Report Malaysia Financial Management brokers call Personal Finance research report Financial Economy General stock investment Money Articles FBMKLCI Stocks market PublicInvest Research Budget Wall Street Update PublicInvest research report Wall Street KLCI oil & gas 1MDB Hong Leong Investment Bank research report Personal Opinion Dow Jones Issue US bursa Credit Card Debt Kenanga research report equity market kenanga research oil price politics ringgit Market Watch PPP klse najib property development Malaysia Weekly Highlights Nasdaq oil property thoughts EPF Hong Leong Investment Bank Research Income Tax construction Maybank Research Misc Money Master Najib Razak S&P 500 Index The Edge Financial Daily US stock market bank negara weekly weekly investment term China Companies in Focus Inflation Loan Rules Theedgemarkets business maybank plantation s&P 500 warren buffett Crude Oil Insurance MIDF research report Maybank IB research Retirement Planning Reuters business news finance global opinion spending stocks with momentum technology Bank Brokers Feng Shui OPEC Savings Wealth bear market currency financial services global market investing microsoft wallstreet 1 Malaysia Development Bhd 1Malaysia Development Bhd BNM International Reserves Billionaire Budget 2016 Commodity Disney Investment Term Malaysia News PCB Petronas Richest People STD Saudi Arabia bloomberg british american tobacco gaming sector low oil price media publicInvest russia share investment stock pick telecommunication top glove trading wallstreet update weakened Ringgit 2010 2016 Air Asia America Bad Debt Bill Gates Billy Toh Budget 2017 Calculation Chinese New Year Currency Exchange Education Fed Forex Gold IPIC Income Iran Kenanga Research research report Lembaga Tabung Haji MAS Macquarie research report Oil & Gas sector Quote RHB Semiconductor Industry Association (SIA) Star Wars Star Wars: The Force Awakens US Fed hike affin hwang capital airasia analyst apple axiata bearish market business highlights construction & engineering consumer products dow jones industrial average earnings report equity expenses global bear market healthcare hup seng industries berhad inari inari amertron berhad interest rate learning malaysia airlines market news maybank investment bank oil and gas oil palm plantation oil prices opr overnight policy rate (OPR) s&P500 s&p satya nadella scandal thought thought of the day 2013 2014 Bank Negara reserves Broker Report Budget 2020 Cash Rebate Donald Trump Earn Financial Planning Financial World Forbes Global Competitiveness Report Global News Global semiconductor sales Goldman Sachs Good Debt How The Rich Get Richer IOI Corp Bhd India Intelligent Investor Interest Rates Linear Income M&A Securities Mahathir Malaysia Business Highlights Maybank 2 card P1 Passive Income Privacy Policy PublicInvest Bank research report REIT RHB Investment Research RHB Research Report RM SIA Sector review TA Research TM TPPA Telekom Malaysia Tun Dr Mahathir US news USD USD against MYR United States Wall Street Journal World Economic Forum Zeti airasia x airlines apple inc asset allocation automotive aviation sector azure banking sector bat beverage bonds box office brent crude budget 2015 bumi armada buy property cash consumer discretionary default developer electricity tariff hike engineering financial market global economy greece gst home hong leong investment bank house infrastructure iphone jobs kossan rubber industries macquarie equities research report malaysia Ringgit market close market updates mukhriz nadella new era for oil opinions pipeline services politic public bank random rate hike research retirement ringgit crisis sector update semiconductor semiconductor sales semiconductor sector shale producers share sime darby stock market. oil & gas industry tax technical analysis telco sector the edge weekly news world market 0% Easy Payment Plan 1MDB scandal 1mdb story 20 cents 2009 2011 29 minutes 3.25% 53 cost cutting measures 7-eleven 9 Things Rich People Do Differently Every Day ABNxcess AFP NEWS AMMB Abu Dhabi fund AirAsia X Bhd Alcohol AmInvestment Bank research report Amazon Ambank Aminvestment research report Ann Joo Ann Joo Resources Bhd Anwar Apple watch Asia Asian stock market Avengers BIMB Securities Research BJ Auto BP Plastics Holding Bhd BSI Singapore Bailout Banking and finance sector Benjamin Graham Biden Bio Osmo Book Borneo Oil Bhd CIMB CLIQ Energy Bhd CPO export tax CPO price CSI 300 Carlos Slim Carlsberg Cepatwawasan Group Bhd Charts China General Nuclear Power Corp China's bond market China's wealthiest man Christmas Circuit breaker Citibank Cash Back card Commodity Watch Credit Customer Service DSKH Holdings (M) Bhd Dagang NeXchange Bhd Datasonic Group Bhd David cameron Debt Status Deficit Deloitte Dividend Domestic news Dutch Lady Milk Industries Bhd E.U ECB EON Eastern & Oriental Bhd Eco World Eco World Development Group Bhd Edra Euro Europe Central Bank European Union Evergreen External Trade FPSO Genesis Fed rate hike Federal Reserves Federal rate Fitbit Fitbit Inc Gamuda Genting Malaysia Berhad George Kent (M) Bhd Global Competitiveness Index Global Issue Gordon Growth Greece exit Greed is Good Guan Chong Bhd Guinness HSBC Hasbro Hektar Reit Hiap Teck Ventures Bhd Highlights Hillary Clinton Hock Seng Lee Hong Leong Bank Bhd Hong Leong Bank Investment research report Hong Leong Bank Wise card Hong Leong Industries Bhd ICB IMF INTC IPO IPOs IT Ibraco Bhd Intel Corporation International Petroleum Investment Company (IPIC) Islamic Banking and finance sector Ismail Sabri JF Apex Securities JF Apex Securities Research Janet Yellen Jerasia Capital Bhd Junk KNM KNM Group Bhd KVMRT 2 Investment KWSP Keep Up With The Joneses Khir Toyo LHDN Leissner Lim Kit Siang Lucasfilm M+ online Market Wrap MARA MH370 MIDA MISC Bhd MLTA MPC MRTA MSN Money News Madza Malaysia Airports Holdings Malaysia Banking Malaysia Bond Market Malaysia fund Malaysian Palm Oil Board Malaysian Ringgit Mara Digital Store March CPO export tax Maxis Maybankard 2 Card Microsoft in the new era Millionaire Next Door Mistakes Motivation N2N Connect NAP 2014 NTPM Holdings Bhd Nazir Razak News Update News at a Glance Nikkei O&G OCBC OPEC war OSA Obama Office 365 Windows 10 Oil Watch PTPTN Packet One Parkson Paypal Perdana Perisai Petronas Chemicals Group Bhd Petronas Gas Bhd Pintaras Jaya Bhd Pioneer Natural Resources Co Power Practical ways on spending Prestariang Bhd Public Investment Research PublicInvestresearch report RBC Capital Markets RCP average poll of US election RGB International Bhd RHB Research RM crisis RM2.6 billion ROE Ranhill Holdings Bhd Rants Rating Raya holiday Recession Ringgit's volatility SEM SKB Shutters Corp Bhd SME segment SP Setia SRR Saizen REIT SapuraKencana Seacera Group Bhd Shale oil Sime Darby Bhd Simee Darby Singles Stimulus Plan Stock Selection for the Enterprising Investor Sunway Construction Bhd Superlon Holdings Bhd Swift Code TIME TMI TNB TOYOTA TRC Synergy Tan Sri Tony Fernandes Tax Reliefs Technorati Tenaga Tenaga Nasional Bhd The Citizens Declaration The Edge Weekly The Negative Side The New York Times Tim Cook Titijaya Land Bhd Trans-Pacific Partnership Agreement Trump v Clinton Tsipras U.K UEM Edgenta Bhd UMNO UMW Oil & Gas UOA US Box Office US election US fed US manufacturing data US market US patent and trademark US prosecutors US stocks USA USD/MYR USEconomy Uchi Technologies Bhd Ultra-Rich Networth individuals UniFi United Kingdom Uob one card Versatile Creative Bhd W-8BEN WCT Holdings Wahid Wal-Mart Wall Street support Warren's Way Windows 10 Yak Yew Chee Yellen Yinson Holding abenomics aemulus affordable housing ahmad bashah ahmad zahid airline airports alibaba alternative investment aluminium asian market audit automobile azure machine learning bank negara malaysia below $30 a barrel berjaya auto bhd berjaya food bond market borneo utara highway brexit britain broadband budget 2018 budget revision bulk purchase of property bullish bullish market burse cloud computing cocoa coffee consumer staples consumption power cost of having a baby crane customer data debt investor deflation risk development downpayment for your home early election earnings per share economic outlook economic outlook 2016 economic sanction economics economy outlook ecoworld effective gross income egi election election budget electric utility electricity electricity bill electricity production endowment plan energy sector entertaiment eps essay european central bank eversendai eversendai corp export data family food beverage food services forecasts foreign-worker levy hike fundamental questions on retirement genting group genting plantation george soros global energy global stock market globetronic glove goldman great eastern group purchase of property has oil bottom? health higher price home business household & Personal product how low can ringgit drop? humor industrial package industry product interest internet investment income investment plan investment strategy iraq jack ma jack ma ready to take on the world jaks resources bhd japan jobless kimlun klci index knowledge land reclaimation work lawsuits life lifestyle lifestyle inflation liquefied natural gas (LNG) machine learning maintain buy malaysia government managing debt manchester united manufacture polyrethane product manufacturing marine engineering market closing market outlook markets mazda medical insurance metering microsoft earnings middle class monetary policy committee moneymaster mortgage movie negative nestle noon market offshore marine support services oil & gas services oil gain oil madness oil market oil production oil rally oil&gas oldtown opr hike patent petrol petrol chemical petroleum petronas gas pipeline project positive power generation power plant prime minister primus pacific private placement profitability ratios project reference property & infrastructure property development and investment putrajaya quantitative easing relative strength index (RSI) renewable energy reputational risk resources retail retailing retirement fund rhb research institute risk risks ruble salesforce sapurakencana petroleum savings for retirement scicom scientex scomi energy services bhd sector sell share markets share price shinzo abe shipbuilding shopping mall stagnation star publication (M) bHd starbucks statistics steel stock market bursa malaysia stock market investment stock price swiss swiss bank takaful tech technical indicator telco the malaysian insider the star thermo-vacuum form plastic packaging manufacturer time value money top gainers top losers trade volume index (TVI) traditional healthcare uchi tech umw holdings upstream oil & gas ursa malaysia value of compounding wal-mart effect warren buffet water related engineering wearable tech webe windows worldwide sales zecon