Mah Sing to launch RM2 bil projects in FY16

Mah Sing Group Bhd (Aug 9, RM1.59)

Reiterate buy with an unchanged fair value of RM2.24 per share: Mah Sing Group Bhd launched its largest township development yet, at Meridin East in Masai, Johor, over the weekend.

In conjunction with the event, Mah Sing opened for sale the remaining 246 units of The Greenway’s double-storey link homes at the new township.

Following the latest weekend opening, the take-up rate for the entire 492 units is now at 85%. Its soft launch in March 2016 saw an 81% take-up rate for the initial 246 units of the double-storey link homes.

Priced from RM357,000, the units come with built-ups of 1,595 sq ft to 1,648 sq ft. As with previous launches, Mah Sing has offered 10% rebates upon placement of bookings.

Mah Sing is targeting to launch RM2 billion worth of properties in FY16, with a sales target of RM2.3 billion.

Unbilled sales as at end-March 2016 totalled RM4.53 billion, 1.6 times of FY15 property development revenue, including RM474 million of final-stage billings over the second quarter to fourth quarter FY16.

Mah Sing has also teamed up with Bank Simpanan Nasional under the Youth Housing Scheme for The Greenway, offering young married couples 100% loans of RM100,000 to RM500,000, additional 5% of mortgage reducing term assurance, RM200/month government disbursements for two years and 50% stamp duty exemptions.

Sited on 1,313 acres (531ha) in Pasir Gudang, Meridin East, with a potential gross development value of RM5 billion spread over 12 to 15 years, is the group’s largest integrated mixed development.

The group has invested RM30 million in the sales gallery, which will later be converted into a community clubhouse. With that, it has year to date undertaken over RM800 million worth of launches.

Over the remainder of the year, it will be offering another RM311 million worth of properties, including semi-detached units, at Meridin East.

Other upcoming launches include Penang Ferringhi 2 and Southville City’s Cerrado Block B. Southville City and Meridin East are expected to be key performers for the group, moving forward. — AmInvestment Bank, Aug 9

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This article first appeared in The Edge Financial Daily, on Aug 10, 2016. Subscribe to The Edge Financial Daily here.