AmResearch maintains Buy on Sunway, ups fair value to RM3.95

KUALA LUMPUR (March 30): AmResearch Sdn Bhd has maintained its “Buy” rating on Sunway Bhd with a higher fair value of RM3.95 (from RM3.60), based on a 20% discount to its upward revised SOP value of RM4.93.

In a note today, the research house said it had incorporated additional investment properties to the SOP, including the recently completed RM340 million Sunway Pinnacle.

“We understand the Pinnacle (mainly offices) is currently above 50% occupied and it should rise to 75% by year-end.

“For FY15F, Sunway is targeting launches worth RM2 billion (effective RM1.5 billion), with prospective sales of RM1.7 billion (effective RM1.2 billion).

“Additionally, its effective unbilled sales as at end-Dec 2014 amounted to RM1.9 billion – 1.6x of FY14 property sales.

“We expect property revenue to grow by about 9% for each of the next two years to RM1.3 billion and RM1.4 billion, respectively (versus RM1.2 billion in FY14),” it said.