Record-high YNH now one of the most expensive property stocks

KUALA LUMPUR (June 18): YNH Property Bhd’s share price climbed as much as 18 sen or 5.63% to hit its all-time high of RM3.58 in the morning session yesterday, albeit in thin trades.

The property counter later fell on profit-taking to settle at RM3.19 yesterday, or down one sen from Tuesday’s close, with 10.27 million shares traded.

Still, it is at its peak following a recent rally that started on June 9. In the period, the counter has gained 18.15% as opposed to the 2.9% decline in the Bursa Malaysia Property Index.

At its last close yesterday, YNH Property is the third most expensive stock across Bursa Malaysia in terms of price-to-book value (P/BV) after its sister company Rapid Synergy Bhd and HCK Capital Group Bhd.

YNH Property, controlled by non-executive director Datuk Dr Yu Kuan Chon with a 32.58% interest, last saw its shares trade at 1.45 times P/BV against net book value of RM2.20 per share.

Rapid Synergy, which has Yu as the common shareholder with 29.44% control over the company, trades at a hefty P/BV of 3.42 times based on its last close of RM5.68 and net book value of RM1.37 per share.

Meanwhile, HCK Capital, whose shares settled at RM1.21 yesterday, traded at P/BV of 2.45 times, against net book value of 49 sen per share. The company is controlled by Sarawakian tycoon Tan Sri Clement Hii whose 63.36% stake is held via Hiichiikok Equities Sdn Bhd.

The valuations are much higher than the P/BV ratio of 0.38 times fetched by the Bursa Malaysia Property Index, which tracks 94 property stocks across the local bourse. 

YNH, which developed a township in its home state Perak, has always boasted that it has interesting assets yet to be capitalised such as a 95-acre plot in Genting Highlands and a three-acre parcel on Jalan Sultan Ismail near the Petronas Twin Towers.

YNH expressed plans to launch two high-rise projects this year with gross development value of RM700 million each in a parcel in Genting Highlands, as well as in Dutamas. That was, however, before COVID-19 hit and disrupted the supply chain.

The group is set to release its first quarter ended March 31, 2020 (1QFY20) results by the end of this month.

For the financial year ended Dec 31, 2019 (FY19), YNH's net profit jumped 170% to RM42.17 million from RM15.61 million, thanks to lower cost of sales amid recognition of balance of profit for the completion of Sfera Residensi in Puchong, and profit contribution from the Kiara 163 project in Kuala Lumpur. Full-year revenue slid 1.32% to RM349.33 million from RM354.02 million.

The results leave YNH shares at a trailing 12-month price-to-earnings ratio of 40 times, as opposed to 200 times PER for Rapid Synergy and 66 times in HCK Capital.

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