KUALA LUMPUR (July 26): CIMB Research has raised UOA Development Bhd's 2012, 2013 and 2014 earnings per share forecast by up to 10%, in view of its stronger-than-expected new sales.

In a research note, it said sales in the first seven months of the year exceed RM1.1 billion, more than its projected full-year sales of RM1 billion.

"It has several more projects in the second half that could drive sales to reach between RM1.5 billion and RM2 billion, which would be very commendable as the developer enjoys pre-tax margins of between 40% and 50%.

"We believe UOA Development's profit margins is sustainable as it undertakes all construction work in-house, therefore saving cost between5 % and 10%," it said.

Moving forward, the research house said UOA Development has, in its pipeline, nearly RM2 billion in new launches for next year to sustain new sales.

CIMB Research maintained a "buy" call on the stock with an upgraded target price of RM2.18. — Bernama

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