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May 19, 2015
Mala
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SEC
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SEE PAGE 23 FOR IMPORTANT DISCLOSURES AND ANALYST CERTIFICATIONS PP16832/01/2013 (031128)
Malaysia Property
Post-GST survey Cautious buying mood prevails.
Policy easing unlikely. Financing remains as the key issue.
The sector lacks of strong re-rating catalysts. Maintain
NEUTRAL, only BUY is SP Setia (SPSB).
What’s New At the recent Home & Property Investment Fair by iProperty.com,
we conducted our own survey on 35 randomly selected visitors, in
addition to conversations with property developers‟ sales forces.
Our findings: 1) 63% of the respondents intended to buy at least one
property over the next 12 months. 2) Most already have at least one
property in hand and were looking for new properties mainly for
investment purposes. 3) Many admitted that they were facing
difficulties in securing mortgage loans. 4) Landed property was still
the preferred property type. 5) Due to pricing issue, many opted to
stay in sub-urban areas. 6) Most respondents believe that property
prices will trend up over the next twelve months. 7) Top concerns
are pricing and financing. 8) Attractive discounts/ incentives were
still being offered by the developers.
What’s Our View While demand trend and buyers‟ concerns remain the same as our
last survey in July 2014, we sense a more cautious buying mood now.
We observed that demand on landed properties priced below
MYR1m/unit stays firm. Downside risks for the developers include:
1) higher-than-expected GST provisioning which would put pressure
on operating margins and 2) weaker-than-expected sales. Policy
easing is unlikely, we believe.
Presently, property stocks under our coverage trade at an average
35-63% discount to our RNAV estimates, which we believe fairly
reflect their near-term outlook. Our strategy remains a defensive
one in view of a more prolonged downcycle in demand which could
last between 9-24 months. SPSB is our only pick for the sector. We
like its earnings defensiveness and 4.4% net yield.
Analyst
Property sector – Peer valuation summary
Stock Rec Shr
px
Mkt cap TP PER (x) PER (x) PER (x) P/BV
(x)
P/BV
(x)
ROE
(%)
ROE
(%)
Net yield
(%) MYR MYR m MYR CY14A CY15F CY16F CY14A CY15F CY14A CY15F CY15F
Eco World Hold 1.73 3,408.5 1.95 61.1 47.6 22.6 1.3 1.1 2.1 2.4 0.5
Glomac Hold 0.95 690.5 1.03 7.9 6.4 5.0 0.7 0.7 9.4 10.8 6.0
Mah Sing Hold 2.15 4,129.0 2.22 9.2 10.2 8.8 1.4 1.1 15.0 13.8 4.6
SP Setia Buy 3.46 8,796.3 4.07 20.7 12.9 10.6 1.1 1.1 7.1 11.0 5.7
Sunway Hold 3.55 6,207.7 3.29 10.9 10.9 11.4 1.0 1.0 10.0 9.2 1.9
UEM Sunrise Hold 1.21 5,490.3 1.27 11.4 16.4 13.4 0.9 0.8 7.6 5.1 2.4
Simple avg 4,787.0 20.2 17.4 12.0 1.1 1.0 8.5 8.7 3.5
Source: Maybank KE
(Unchanged)NEUTRAL
Wong Wei Sum, CFA
(603) 2297 8679
May 19, 2015 2
Malaysia Property
Cautious buying mood prevails
The recent Home & Property Investment Fair by iProperty.com held on 17-
19 April in Kuala Lumpur Convention Centre was well represented by most
listed developers - Eco World, SP Setia, Tropicana, WCT Land, Titjaya
Land, Tropicana, UEM Sunrise, Hua Yang, Paramount, MRCB Land and
Sunsuria - and/or their subsidiaries. The soon-to be-listed Aspen Group
(one of the largest land owners in Batu Kawan, Penang mainland) was
there for the first time to showcase its Aspen Vision City project in Batu
Kawan.
Apart from discussions with the property developers‟ sales forces, we also
conducted our own survey on 35 randomly selected visitors of various age
groups during the property fair. We tried to identify the impact of GST
implementation on buying decision and buyers‟ sentiment as well as the
current trends in property demand with our questions focusing on buyers‟
purchase decision, preferred products, choice locations, key considerations
and concerns. The key findings of our survey are:
1) Buyers sentiment weakens, financing is an issue
While 77% of the respondents expected property prices to trend up further,
only 63% intended to buy at least one property over the next 12 months (a
decline from our previous pre-GST survey of 80% in June 2014 involving 30
respondents) as some of the respondents are adopting a wait-and-see
attitude. Close to half of the respondents (46%) faced difficulties in
securing mortgage loans.
Elsewhere, price discounts/rebates ranging from 5%-17% (depending on
furnishing/renovation packages chosen; GST will be charged on the
furnishing/renovation packages for residential properties) were offered
during the property fair, we observed.
Our views:
Confirm no rush into property purchases pre-GST. During our 2-days
at the property fair, we observed the fair had thinner crowds and was
relatively quiet as compared to what we observed in the previous fairs
in June 2014 and July 2013. Our conversations with property agents/
sales staff confirmed a known fact - that actual sales have been
lacklustre since 2H14 and the buying mood have been cautious with
most buyers putting home purchases on hold. A few of the agents/sales
staff admitted that there was no rush into property purchases pre-GST
implementation on 1 April, within our expectation. Key reasons
attributing to the lacklustre sales include tighter lending conditions by
the banks and weaker consumer sentiment on more subdued economic
outlook dragged by lower crude oil prices and the weaker MYR vs. USD.
We remain cautious on the Malaysia property sector and expect the
macro headwinds (GST implementation, volatile crude oil prices) and
prolonged tightening property and lending measures to continue
weighing on buyers‟ sentiment. The slowdown in demand could last
between nine months to two years, we believe.
May 19, 2015 3
Malaysia Property
Property data also shows weakening demand. Claims by the property
agents/sales staff are also confirmed by official figures released by
NAPIC. Latest statistics show that the value of residential property
transactions for the country had fallen by 7% QoQ in 4Q14 (3Q14: +4%
QoQ, 4Q13: +7% QoQ) while on YoY basis, property transactions
recorded a lower growth of 2% (3Q14: +17% YoY, 4Q13: +15% YoY).
Price wise, NAPIC‟s statistics also showed signs of easing with the
House Price Index (HPI) contracting marginally by 0.2% QoQ in 4Q14.
The official numbers provided by NAPIC did not capture the rebates/
discounts provided, we believe. The 1Q15 statistics are expected to be
release in June-July.
Contrary to the general expectation of higher residential property
prices post-GST, we expect flat growth or marginal decline in property
prices as: 1) most developers have already re-priced or re-cost their
products to include GST in 2014, ahead of the GST implementation this
April, 2) property price is a function of market forces – demand and
supply. Developers may have to offer more discounts/rebates to entice
property buyers in a weak market environment and 3) declining
housing affordability (residential properties) may put downward
pressures on property prices. Property price growth of 11% CAGR
between 2009-2014 was above income growth of 6.9%, driven by cheap
financing, ample of liquidity and attractive marketing incentives by
the developers after the global financial crisis.
Malaysia’s residential property transactions up 2% YoY (in value) but down 7% YoY (units) in 4Q14
Source: CEIC
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
60%
Unit Value
(YoY growth)
May 19, 2015 4
Malaysia Property
QoQ, Malaysia’s residential property transactions declined by 5% (in units) and 7% (value) in 4Q14
Source: CEIC
Property prices softened: 4Q14 Malaysia House Price Index (HPI) up 7% YoY but down 0.2% QoQ following queue from the decline in property transactions
Source: CEIC
-40%
-30%
-20%
-10%
0%
10%
20%
30%
40%
50%
Unit Value
QoQ growth
80
90
100
110
120
130
140
150
160
170
180
190
200
210
220
230
240
250
260
270
Malaysia KL Selangor Penang Johor
May 19, 2015 5
Malaysia Property
Buyers put off by tougher mortgage checks. Close to half of our
respondents (46%) were facing difficulties in securing mortgage loans
as most of them are below 30 years old (57%; relatively low income
earners) and many already own at least one property (63%). This
implies limited room to gear up for additional properties.
Our conversations with the bankers/sales people during the property
fair revealed that the loan rejection rate remains high at 40-50%
(depending on product types; affordable housing, where the buyers are
largely the first-time/genuine home buyers, has a lower loan rejection
rate) compared to 10-20% in our 2012-2013 surveys. To lower the
cancellation in unit booking on loan rejection, most bankers/sales
people have started conducting brief checks with the potential buyers
on their credit backgrounds, prior to purchase commitments.
The latest banking statistics data are also in line with our findings from
the property fair. The latest data show that residential mortgage and
non-residential loan applications failed to pick up in Mar 2015 before
the implementation of GST in Apr 2015 where the 3-month moving
average (3MMA) was down 3.7% YoY and 0.5% YoY respectively.
Meanwhile, the 3MMA loan approvals also declined YoY for residential
(-4.5%) and non-residential (-1.3%) property. Judging from our survey
and discussions with sales people and developers as well as bankers,
we expect April statistics for residential and non-residential mortgage
applications/approvals to remain in negative growth as buyers appear
to be less inclined to rush into buying properties post-GST.
3M MA (Jan - Mar 2015) residential mortgage applications declined at a slower pace (-3.7% YoY) compared to Nov-Dec 2014 (-17.4 to -17.7% YoY)
3M MA (Jan - Mar 2015) non-residential mortgage applications declined by 0.5% YoY after a positive 2% in Feb 2015
Source: BNM Source: BNM
3M MA residential property approvals down 4.5% YoY 3M MA non-residential property approvals down 1.3% YoY
Source: BNM Source: BNM
-40.0%
-20.0%
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
Mar-07 Mar-09 Mar-11 Mar-13 Mar-15
3M MA (YoY chg mortgage application)
(% YoY Chg)
-40.0%
-20.0%
0.0%
20.0%
40.0%
60.0%
80.0%
100.0%
Mar-07 Mar-09 Mar-11 Mar-13 Mar-15
3M MA (YoY chg in non residential property application)
(% YoY Chg)
-50.0%
0.0%
50.0%
100.0%
3M MA (YoY chg in residential property approvals)
(% YoY Chg)
-50.0%
0.0%
50.0%
100.0%
150.0%
3M MA (YoY chg in non-residential property approvals)
(% YoY Chg)
May 19, 2015 6
Malaysia Property
2) Still investment buying intention despite stricter ruling;
policy easing is unlikely
63% of our respondents already own at least one property and just as many
were looking to buy new properties for investment (57% versus 41% in our
survey in June 2014) instead of for owner occupation.
Our views:
Undeterred by stricter property cooling/lending measures. We were
not surprised by the survey outcome as 57% of our respondents are
aged below 30 years old and are in the beginning stage of wealth
accumulation where real estate is usually a popular investment choice.
Property cooling measures in recent years
Mth-Year Property cooling measures
Jan-10 Budget 2010 reintroduced the RPGT at 5% for properties sold within the first 5
years of sale. This was announced in Sept 2009 and took effect in Jan 2010
Nov-10 LTV ratio for third residential properties reduced from 90% of property value
to 70% (remains at 90% for the first two properties)
Oct-11 Budget 2012 raised RPGT to 10% within first 2 years of sale and maintains at
5% between year 3 and 5 of sale
Jan-12 BNM introduced responsible lending measures where loans are disbursed based
on net income instead of gross income
Sep-12 Budget 2013 raised RPGT to 15% within first 2 years and 10% between year 3
and 5 of sale
Oct-13 Budget 2014 raised RPGT to 30% within first 3 years and 15-20% between year 4 and 5 of sale; ban on developer interest bearing scheme (DIBS); higher floor
price for foreign buyers; developers are required to display detailed selling
prices
Source: BNM, Budget 2010-2014
A cut in interest rate may not boost property demand. Our
economist expects the benchmark overnight policy rate (OPR) to stay
at 3.25% throughout 2015 for now, pending the release of 2Q15 GDP
data in Sep 2015 which would give a better indication on the impact of
the GST on domestic demand and inflation. Even if there is a potential
cut in interest rate, we do not expect a significant impact on property
demand (a 25bp OPR cut would reduce monthly instalment by MYR111
[-3.3%] for a property worth MYR800k assuming 90% loan financing at
an initial base rate of 4.45% and a 35-year loan tenure). In our view,
the key determining factor of property demand for now should be the
ability to secure mortgages, instead of interest rate, which is still
accommodative and attractive. Also, a lower OPR indicates a weaker
economic outlook which may not bode well for buyers‟ sentiment.
Policy easing unlikely. While the property sector has started showing
signs of weakness, we do not expect any policy easing to happen in the
short-term especially when household (HH) debt has remain high at
87.9% of nominal GDP at end-2014. This is despite the central bank‟s
continuous efforts in reining in HH debt expansion and curbing
speculative demand.
May 19, 2015 7
Malaysia Property
Household debt has been on the uptrend since 2008
Source: BNM, CEIC
3) Demand trend is the same - still on the landed
Landed properties priced <MYR1m/unit continue to receive strong demand,
based on our latest survey.
Our views:
Slowdown in luxury/high-rise segments. Our discussions with property
agents/sales staff revealed that the demand for high-rise general/high-
rise luxury properties remain weak especially those priced >MYR1m
each. See Hoy Chan‟s the Potpourri @ Ara Damansara (MYR800psf) was
only 60% sold since its launch in 2014 while another high-rise project in
Jalan Ipoh offers discounts of up to 17% for an semi-furnished unit, we
were told. Most developers under our coverage have continued to
focus on affordable housing and landed properties and put their high-
end/luxury projects on the backburner.
Follow the MRT/LRT lines. Rising prices are barriers to own properties
in the city centre. As such, 40% of the respondents prefer to stay in
sub-urban areas and this could lead to demand on properties with close
proximity to public transportation stations in the sub-urban areas,
albeit public transportation has yet to feature prominently as a
consideration on the Malaysian homebuyers‟ priority list for now.
A few new property hotspots have emerged in the southern Klang
Valley - Kajang, Semenyih, Bangi, Puchong South and Canal City. The
popularity of some of these areas will be enhanced by the upcoming
MRT/LRT lines. Beneficiaries include MKH Bhd (MKH MK), Eco World
Development (ECW MK), Mah Sing (MSGB MK), UEM Sunrise (UEMS MK)
and IOI Properties (IOIPG MK).
May 19, 2015 8
Malaysia Property
4) Aspen Group, a rising star in the northern Malaysia
During our 2-days at the property fair, we observed that Aspen Group‟s
(AG) property booth attracted quite a considerable crowd. Aspen Group is
a Penang-based property development and real estate investment group
with focus on affordable housing. The company, which is seeking for an IPO
listing by end-2015, is one of the largest land owners in Batu Kawan, an
upcoming and new growth area in Penang mainland. Batu Kawan is where
the 2nd Penang Bridge, opened last year, connects from the mainland.
During the property expo, AG showcased its maiden project in Batu Kawan
- Aspen Vision City Phase 1 comprising 441 units of shop offices (MYR776m
in GDV; from MYR1.2m/unit onwards). Phase 1 is 80% booked, we were
told. Aspen Vision City, which has an estimated GDV of MYR8b, will
comprise an IKEA store, a shopping mall, an international school, office
towers, shops, a hospital and hotels. The planned development period is
over 10 years.
Aspen Group’s Aspen Vision City in Batu Kawan
Source: Maybank KE
We were told that Aspen Vision City is 80% booked
Source: Maybank KE
May 19, 2015 9
Malaysia Property
Valuations and recommendations
The sector‟s lacklustre near-term outlook has resulted in a 10.5% fall in the
property index since Nov 2014. While the valuations of some property
stocks appear attractive, we advise investors to be selective, focusing on
those with healthy balance sheets and low exposure to Iskandar Malaysia
hotspots. The sector lacks of strong re-rating catalyst and the demand
slowdown could last for 9-24 months, we believe. Some developers
however expect demand to start picking up in 2H15 instead. The negative
lag impact on earnings will start to feature from 2H16-FY17, we estimate.
We think the most notable downside risks for the developers include: 1)
higher-than-expected GST provisioning which would put pressure on
operating margins. Thus far, SP Setia is the only company under our
coverage that has made provisions for the GST impact on ongoing projects,
and 2) weaker-than-expected sales. Tropicana has recently cut its sales
target by 30% after its weak 1Q15 results, we understand.
That said, we believe at this level, the share prices have already factored
in a lot of negative news flow and expectations for the sector. Hence, the
downside risks highlighted in the preceding paragraph should be contained.
From a top-down approach, we maintain our NEUTRAL call on the sector.
We do not expect any near-term policy changes with regard to mortgage
applications and approvals, and government cooling measures.
Stock wise, property stocks under our coverage are presently trading at an
average 35-63% discount to our RNAV estimates. We advocate investors to
go defensive in stock selection. SP Setia (SPSB MK; BUY; MYR4.07 TP) is our
only BUY pick for the property sector.
SP Setia (SPSB MK; BUY; MYR4.07 TP): We like SPSB for its: 1)
earnings defensiveness backed by MYR10.2b of unbilled sales as at end-
Jan 2015 (1.8x of our FY10/15 revenue forecast) and strategically
located landbank secured at cheap land costs (which allows it to be
more flexible in pricing and product launches in times of uncertainty),
2) dividend payout policy of 50% (which offers a 4.4% net yield for the
current year, based on our earnings estimates). SPSB has been paying
more than 60% of its net profit over the last few years.
The „leadership/management‟ concerns are over, in our view. Staff
turnover has stabilised with a well-planned transition strategy being
executed since last year. A potential M&A is another catalyst.
May 19, 2015 10
Malaysia Property
Valuations
Stocks
Price (MYR/share)*
(a)
RNAV (MYR/share) (b)
P/RNAV TP (MYR/sh)
(b) x (c )
Upside (%)
Rating
Our valuation basis - P/RNAV Current
P/RNAV (x)
Our valuations
- P/RNAV (x) ( c)
Eco World
(ECW MK)
1.73 2.67 0.65 0.73 1.95 12.7 HOLD We value Eco World at 0.73x
P/RNAV (-0.1x to SPSB's historical P/RNAV mean).
While we like its strong
management team and track
record, its high land costs (since most of the land was
acquired during the property
upcycle in 2012-2013) may reduce its flexibility in
competitive pricing during
times of uncertainty. Glomac
(GLMC MK)
0.95 2.07 0.46 0.50 1.03 8.7 HOLD We value Glomac at its
historical P/RNAV mean of
0.5x.
Mah Sing
(MSGB MK)
2.15 3.47 0.62 0.64 2.22 3.3 HOLD We value Mah Sing at 0.64x
P/RNAV (-0.15x below its
historical mean). The discount is to reflect its
considerable exposure (59%
of its remaining GDV as at Sep 2014) to the high-rise
property segment e.g. Icon
City, Southville City
(offices), Puchong land, Southbay City and KKCC.
Mah Sing has the highest foreign shareholdings among
the stocks under our
coverage.
SP Setia
(SPSB MK)
3.46 5.58 0.62 0.73 4.07 17.7 BUY We value SP Setia at a
discounted valuation - 0.73x
P/RNAV, which is 0.1x below its historical mean. Potential
re-rating catalysts include
more clarity from PNB on management succession and
asset injections plans.
Sunway
(SWB MK)
3.55 5.57 0.64 0.590 3.29 -7.4 HOLD Large exposure to the luxury
property segment and Iskandar Malaysia, which is
currently facing stiff
competition with the entry of Chinese developers. We
value Sunway at its historical
P/RNAV mean of 0.59x. As
compared to UEMS, Sunway has a more diversified and
recurring earnings base.
UEM
Sunrise
(UEMS MK)
1.21 3.26 0.37 0.39 1.27 5.1 HOLD Large exposure to the
increasingly crowded
Iskandar Malaysia while its Klang Valley projects are
mostly high-end products.
We value UEM Sunrise at
0.39x P/RNAV (-0.2x below its historical mean).
* as at 18 May 2015
Source: Maybank KE
May 19, 2015 11
Malaysia Property
Foreign shareholdings for stocks under our coverage remain flat / declining
Source: Companies
5.6
6.0
6.0
6.0 6.1
6.17 6.25 6.20 6.10 6.13 5.90
18.5 18.5 19.0 18.8 18.6 18.4 19.218.5
17.6 17.717.1
8.4
8.5
8.0 8.0 8.1 8.1 8.1 8.2 8.28.1
8.06.86.7 6.8 6.8 6.9
7.58.1
8.4 8.48.8 8.7
13.6 13.4 13.2 13.1 13.0 13.1 13.1212.77 12.8 12.85 13.01
3.73.3 3.2 3.2
2.60.7 0.6 0.6 0.6
0.0
5.0
10.0
15.0
20.0
25.0
June 14 July 14 Aug 14 Sep 14 Oct 14 Nov 14 Dec 2014 Jan 15 Feb 15 Mar 15 Apr 15
Glomac Mah Sing SP Setia Sunway^ UEM Sunrise Eco World(%)
May 19, 2015 12
Malaysia Property
Our April 2015 survey: Respondents’ profile
Respondents’ profile: Mostly locals Age profile: Well split between the young and middle-aged
Source: Maybank KE Source: Maybank KE
Job profile: Judging from the job profile, 60% of our respondents (business men, managers and professionals) could be the high-income earners
Number of properties in hand: Most respondents have already at least one property in hand
Source: Maybank KE Source: Maybank KE
94%
6%
Malaysian Non-Malaysian
34%
23%
17%
3%
3%
6%
14%
20-25 26-30 31-35 36-40 41-45 46-50 >50
9%
37%
3%
26%
14%
11%
Managerial professional
Government servants executive
Business Students/retiree
37%
37%
3%
23%
None 1 unit 2 units >2 units
May 19, 2015 13
Malaysia Property
Our April 2015 survey: Buying sentiment, preferred products, key considerations and concerns
Buying properties within the next 12 months? Most respondents were looking to buy a property within the next 12 months even though 63% already have at least one property in hand
Do you expect property prices to go up further? YES, from the majority
Source: Maybank KE Source: Maybank KE
Preferred product type: Most of the respondents were looking to buy landed properties
Reason for purchase: Interestingly, many respondents were still looking to buy properties for investment despite the property curbs in place since early-Jan 2014
Source: Maybank KE Source: Maybank KE
Do you face difficulties in securing mortgage loan? Close to half of the respondents said yes
Preferred location: Not a surprising response since we believe the majority of the respondents currently reside in Klang Valley
Source: Maybank KE Source: Maybank KE
22
10
3
0
5
10
15
20
25
Yes No Not sure
Respondents' Choices
27
7
1
0
5
10
15
20
25
30
Yes No Not sure
Respondents' Choices
13
27
7
0
5
10
15
20
25
30
High rise Landed Commercial
Respondents' choice
24
17
1
0
5
10
15
20
25
30
Investment Own use For kids
Respondents' Choices
16 16
3
0
5
10
15
20
Yes No Not sure
Respondents' Choices
34
1
42
0
5
10
15
20
25
30
35
40
Klang Valley Iskandar Malaysia Penang Overseas
Respondents' Choices
May 19, 2015 14
Malaysia Property
Preferred location: Many opt for sub-urban areas due to the high pricing for city centre properties
Preferred type of properties: Landed property is still the preferred choice
Source: Maybank KE Source: Maybank KE
Preferred size: 1,001-1,500 sq.ft. was the most common size range for our respondents
Budget for property: Units priced below MYR1m are the focus of most respondents. Most developers under our coverage have been switching focus to affordable housing segment
Source: Maybank KE Source: Maybank KE
Concerns: Pricing and financing were the key concerns of the 35 respondents
Key considerations: Location, pricing, security were the key considerations, similar to the outcome of our survey in June 2014
Source: Maybank KE Source: Maybank KE
18
12
0
5
10
15
20
City Sub-urban
Respondents' Choices
13
27
7
0
5
10
15
20
25
30
High rise Landed Commercial
Respondents' choice
1
14
18
78
0
5
10
15
20
<500 sq.ft. >500-1,000 sq.ft. 1,001-1,500 sq.ft. 1,501-2,000 sq.ft. >2,000 sq.ft.
Respondents' Choices
13
19
32 2
0
5
10
15
20
< MYR500k MYR500k-MYR1.0m MYR1.05-MYR1.5m MYR1.51-MYR2.0m >MYR2.0m
Respondents' Choices
22
1110
34
00
5
10
15
20
25
Pricing/Budget Financing Hard to find goodproperty/location
Developer'screditability
BNM stricter ruling Security
Respondents' Choices
20
26
9 9
1
10
0
5
10
15
20
25
30
Pricing/Budget Location Developer'screditability
Infrastructure Marketingincentives
Security
Respondents' Choices
May 19, 2015 15
Malaysia Property
Photos from the Home & Property Investment Fair by iProperty.com
Participants in iProperty Expo on 17 Apr-19 Apr 2015, KL Convention Centre
Saturday (18 Apr 2015), 2.30-2.45pm - The crowd was significantly smaller compared to the property expo we attended the last two years
Source: Maybank KE Source: Maybank KE
Scene on Saturday (18 Apr 2015), 2.45pm Scene on Saturday (18 Apr 2015), 5.30pm
Source: Maybank KE Source: Maybank KE
Scene on Saturday (18 Apr 2015), 5.30pm Scene on Sunday (19 Apr 2015), 3.30-5.00pm
Source: Maybank KE Source: Maybank KE
May 19, 2015 16
Malaysia Property
Scene on Sunday (19 Apr 2015), 3.30-5.00pm Scene on Sunday (19 Apr 2015), 3.30-5.00pm
Source: Maybank KE Source: Maybank KE
Some familiar names
SP Setia WCT Land
Source: Maybank KE Source: Maybank KE
Titijaya UEM Sunrise
Source: Maybank KE Source: Maybank KE
May 19, 2015 17
Malaysia Property
Newcomer –Aspen Group Eco World
Source: Maybank KE Source: Maybank KE
May 19, 2015 18
Malaysia Property
Peer comparison 1 Company Eco World UEMS SP Setia Sunway Mah Sing Glomac
FYE Oct Dec Oct Dec Dec Apr
Share price (MYR/sh) @
18 May 2015 1.73 1.21 3.46 3.55 2.15 0.95
Number of shares ( m
shares) 1970.2 4,537.4 2,542.3 1,748.6 1,920.5 726.8
Market capitalisation
(MYR m) 3,408.4 5,490.3 8,796.4 6,207.5 4,129.1 690.5
Beta 2.7 1.5 0.5 0.8 0.7 0.8
Target price (MYR/sh) 1.95 1.27 4.07 3.29 2.22 1.03
RNAV (MYR/sh) 2.67 3.26 5.58 5.57 3.47 2.07
Our TP: premium /
discount to RNAV (%) -historical mean
-27 -61 -27 -41 -36 -50
Current disc/ premium
to RNAV (%) -35 -63 -38 -36 -38 -54
Potential upside (%) 12.7 5.1 17.7 -7.4 3.3 8.5
Recommendation HOLD HOLD BUY HOLD HOLD HOLD
Business background A fast-growing
property group
built up by former SP Setia
directors and
executives
One of the
largest
developers in Malaysia and land
owner in Iskandar
Malaysia
One of the
leading property
players in Malaysia; It is the
developer of
reputable Setia Alam and Setia
Eco Park
projects;
Currently, it has property projects
in Malaysia,
Singapore, Australia, UK,
China and
Vietnam
One of the
leading property
and construction groups in
Malaysia. It is
also the sponsor of SunREIT.
Reputable
projects
including Bandar Sunway
township. It is
one of the largest land owners in
Iskandar Malaysia
Developer of
Southville City,
Icon City and M City. It is famous
with its fast-
turnaround strategy
Small cap bumi-
developer. Key
projects include Lakeside
Residences and
Bandar Saujana Utama. Close to
50% of its
remaining GDV is
from affordable township
developments
Remaining GDV (MYR b) 61.2 103.3 73.6 30.3 43.8 7,636.0
Remaining landbank
(acres) 4,516 14,594.5 4,610.5 2,200.3 3,651 -
Company sales target
(MYR m ) - 2012 - 2,000.0 4,000.0 1,200.0 2,500.0 500.0
- 2013 - 3,000.0 5,500.0 1,400.0 3,000.0 800.0
- 2014 2,000.0 2,000.0 5,000.0 1,300.0 3,600.0 500.0
- 2015 3,000.0 2,000.0 4,600.0 1,200.0 3,432.5 600.0
Actual sales (MYR m)
- 2012 - 2,460.0 4,230.0 1,560.0 2,503.0 663.0
- 2013 - 2,989.1 8,241.0 1,400.0 3,001.0 802.0
- 2014^ 3,186.5 2,443.0 4,623.0 1,300.0 3,432.5 504.0
- 2015 621.0 0.0 1,019.0 0.0 0.0 86.0
% achieved - 2012 - 123% 106% 130% 100% 133%
- 2013 - 100% 150% 100% 100% 100%
- 2014 159% 122% 92% 100% 95% 101%
- 2015 21% 0% 22% 0% 0% 14%
Sales growth (%) - 2012 - 23% 28% -13% 11% 59%
- 2013 - 22% 95% -10% 20% 21%
- 2014 - -18% -44% -7% 14% -37%
Source: Companies, Maybank KE
May 19, 2015 19
Malaysia Property
Peer comparison 2 Company Eco World UEMS SP Setia Sunway Mah Sing Glomac
Unbilled sales MYR3.1b
unbilles sales as
at Jan 15, or
3.9x of our FY10/15
property
revenue
forecast
MYR3.9b unbilles
sales as at Dec
2014, or 2.6x of
our FY15 property revenue
forecast
MYR10.2b as at
end-Jan 2015,
or 1.8x of our
FY15 property revenue
forecasts
MYR1.9b as at
end-Dec 2014, or
1.1x of our FY15
property revenue forecasts
MYR5.3b as at
end-Dec 14, or
2.0x of our FY15
property revenue forecasts
MYR537m as at
end-Jan 2015, or
0.8x of our
FY4/15 property revenue forecasts
Foreign shareholdings (%)
## 0.6 13.0 8.0 8.7 17.1 5.9
Official/unofficial div
payout policy (%) NA 20-40% 50.0 20-30 40.0 Unofficial 40%
Forecasts EPS - 2013A 7.7 13.0 17.8 30.6 20.2 14.8
- 2014A 2.8 10.6 16.2 34.2 23.4 12.9
- 2015F 3.0 7.4 25.6 34.3 21.0 11.6
- 2016F 6.8 9.0 32.7 34.5 24.4 16.6
NDPS - 2013A 0.4 4.0 10.6 10.0 8.0 4.2
- 2014A 0.0 3.0 9.7 11.0 6.5 4.9
- 2015F 0.0 2.4 15.3 6.9 8.4 3.5
- 2016F 0.7 2.9 19.6 6.9 9.8 5.0
NTA* 0.65 1.40 2.37 3.44 1.54 1.27
Valuation
Earnings growth (%) - 2013 544% 26% -6% 13% -1% 14%
- 2014 -63% -19% -9% 12% 16% -13%
- 2015 6% -30% 58% 0% -10% -10%
- 2016 128% 22% 28% 0% 16% 43%
PER (x) - 2013 22.6 9.3 19.4 11.6 10.6 6.4
- 2014 61.1 11.4 21.3 10.4 9.2 7.4
- 2015** 32.7 16.4 13.5 10.3 10.2 8.2
- 2016** 14.3 13.5 10.6 10.3 8.8 5.7
Net div yield (%) - 2013 0.3 3.3 3.1 2.8 3.7 4.4
- 2014 0.0 2.5 2.8 3.1 3.0 5.2
- 2015** 0.0 2.0 4.4 1.9 3.9 3.7
- 2016** 0.7 2.4 5.7 1.9 4.6 5.3
P/NTA (x) 2.7 0.9 1.5 1.0 1.4 0.7
P/RNAV (x) 0.65 0.37 0.62 0.64 0.62 0.46
Net gearing (x)* 1.67 0.26 0.38 0.30 0.36 0.34
Major shareholders @ Liew Tian Xiong
(16.4%), EW Dev
Holdings
(38.5%), Syabas
Tropikal (30.7%)
Khazanah (66.1%), EPF
(5.0%), LTH
(5.1%)
PNB (68.2%), KWAP (9.4%)
Cheah family (49.8%), PNB
(7.2%)
Tan Sri Leong (29%), EPF (6.1%)
Tan Sri Dato' Mohamed Mansor
bin Fateh Din
(19.9%), Dato'
Fateh Iskandar bin Tan Sri Dato'
Mohamed Mansor
(15.6%), Datuk Fong Loong Tuck
(16.0%)
^ Eco World's 13MFY10/14 sales, ^^ Eco World and SP Setia's FYE is Oct while Glomac's FYE is April
Source: Companies, Maybank KE
May 19, 2015 20
Malaysia Property
SWOT analysis
Eco World UEMS SP Setia Sunway Mah Sing Glomac
Strength Strong
management team (former SP
Setia staffs) and
proven track
record (in SP Setia); Large
exposure in
township developments
e.g. EcoMajestic
at Semenyih and
projects in Tebrau, Iskandar
Malaysia and
mainland of Penang; mostly
landed
properties; Strong and loyal
followers (from
SP Setia)
Strong political
links (backed by Khazanah);
Largest land
owner in
Iskandar Malaysia with strategically
located landbank
(mostly freehold + close proximity
to the Second
Link); Strong
Sunrise brandname and
expertise in
high-rise integrated
development
Strategically
located landbank (urban
redevelopment
projects i.e. KL
Eco City, Setia Federal Hill +
resilient
townships like Setia Tropika and
Setia Alam);
backed by huge
unbilled sales of MYR10.2b
Strong Sunway
brandname; Diversified
earnings base e.g
construction and
quarry businesses;
Supported by
steady rental income from
investment
properties and
dividend income from 34%-owned
Sunway REIT;
Singapore projects are
supported by
strong JV partner, Hoi Hup
Strong Mah Sing
brandname; Aggressive and
flexible
management
team; Fast turnaround
strategy which
means lower holding cost and
strong cash flow
One of the few
bumi-developers with strong
political links;
Large exposure
in township developments -
Bandar Saujana
Utama, Lakeside Residence,
Saujana Rawang
and Sepang
Weakness Demanding valuations (from
PER perspective)
as earnings will
only start coming in from 2015
onwards
(progress billings), at the
earliest, as first
phase of EcoSky
and EcoBotanic projects were
only launched in
Sep 2013; Higher net gearing as no
significant
earnings contributions in
the short term;
Relatively lower
margin due to heavy marketing
/ brand
awareness activities. Eco
World Dev S/B
was only set up in 2013. Also,
most of the lands
were acquired
over the last 1.5 years
Long gestation period and
considerable
infrastructure
works for Gerbang
Nusajaya;
Concentration risk as majority
of total landbank
and remaining
GDV are in Iskandar
Malaysia; Major
shareholder (Khazanah) may
have outright
decision-making power especially
in land sale;
Volatile earnings
performance due to heavy reliance
on land sales
Illiquid; Strong sales / earnings
performance
overshadowed by
execution management
risk; exposure to
currency risk given 21% of its
remaining GDV is
derived from its
UK and Vietnam projects.
Mostly high-end products, less
exposure in
affordable
township developments;
its recently-
acquired Pendas North and
Pendas South
land in Medini
require considerable
infrastructure
capex; >50% of total GDV is from
its Medini
project – Sunway Iskandar
Lack of a flagship project
which can define
Mah Sing; High
foreign shareholdings
may add to the
stock's vulnerability
amid volatility in
the external
markets
Small market capitalisation
Source: Maybank KE
May 19, 2015 21
Malaysia Property
SWOT analysis
Eco World UEMS SP Setia Sunway Mah Sing Glomac
Opportunity Potential RNAV-
accretive land
acquisition;
listing of Eco World SPAC (for
international
projects)
Potential RNAV-
accretive land
acquisitions;
better transportation
system between
Johor Bahru and Singapore;
Potential RNAV-
accretive land
acquisitions; the
KV MRT circle line may benefit
Setia Federal Hill
projects
Potential
jobwins from
MRT 2nd and 3rd
lines; potential RNAV-accretive
land acquisitions
Potential RNAV-
accretive land
acquisitions; the
KV MRT circle line may benefit
M City project
Potential RNAV-
accretive land
acquisition;
potential enbloc sales in Glomac
Damansara and
Plaza Kelana Jaya IV
Threat Downturn in
property sector
Political and
execution risks
involving
bilateral relations
between
Malaysia-Singapore;
Increasing
competition from local and
foreign
developers
especially in Iskandar
Malaysia's
hotspots; Downturn in
property sector
Downturn in
property sector;
Country and
currency risks (with projects in
UK, Australia,
Singapore and Vietnam);
Uncertainties in
China property
market (10% of
its remaining GDV is from
China);
Increasing competition
from local and
foreign developers
especially in
Iskandar
Malaysia; Downturn in
property sector
especially high-rise high-end
products
Downturn in
property sector
Downturn in
property sector
Source: Maybank KE
May 19, 2015 22
Malaysia Property
Research Offices
REGIONAL
Sadiq CURRIMBHOY
Regional Head, Research & Economics
(65) 6231 5836 [email protected]
WONG Chew Hann, CA
Regional Head of Institutional Research
(603) 2297 8686 [email protected]
ONG Seng Yeow
Regional Head of Retail Research
(65) 6432 1453
ECONOMICS
Suhaimi ILIAS Chief Economist Singapore | Malaysia
(603) 2297 8682 [email protected]
Luz LORENZO Philippines (63) 2 849 8836
Tim LEELAHAPHAN Thailand (66) 2658 6300 ext 1420
JUNIMAN Chief Economist, BII Indonesia (62) 21 29228888 ext 29682 [email protected]
STRATEGY
Sadiq CURRIMBHOY
Global Strategist
(65) 6231 5836 [email protected]
Willie CHAN
Hong Kong / Regional
(852) 2268 0631 [email protected]
MALAYSIA
WONG Chew Hann, CA Head of Research (603) 2297 8686 [email protected] • Strategy
Desmond CH’NG, ACA (603) 2297 8680 [email protected] • Banking & Finance
LIAW Thong Jung (603) 2297 8688 [email protected] • Oil & Gas Services- Regional
ONG Chee Ting, CA (603) 2297 8678 [email protected] • Plantations - Regional
Mohshin AZIZ (603) 2297 8692 [email protected] • Aviation - Regional • Petrochem
YIN Shao Yang, CPA (603) 2297 8916 [email protected] • Gaming – Regional • Media
TAN Chi Wei, CFA (603) 2297 8690 [email protected] • Power • Telcos
WONG Wei Sum, CFA (603) 2297 8679 [email protected] • Property
LEE Yen Ling (603) 2297 8691 [email protected] • Building Materials • Glove • Ports • Shipping
CHAI Li Shin, CFA (603) 2297 8684 [email protected] • Plantation • Construction & Infrastructure
Ivan YAP (603) 2297 8612 [email protected] • Automotive • Semiconductor • Technology
Kevin WONG (603) 2082 6824 [email protected] • REITs • Consumer Discretionary
LIEW Wei Han
(603) 2297 8676 [email protected] • Consumer Staples
LEE Cheng Hooi Regional Chartist (603) 2297 8694 [email protected]
Tee Sze Chiah Head of Retail Research
(603) 2297 6858 [email protected]
HONG KONG / CHINA
Howard WONG Head of Research (852) 2268 0648 [email protected] • Oil & Gas - Regional
Alexander LATZER (852) 2268 0647 [email protected] • Metals & Mining – Regional
Benjamin HO (852) 2268 0632 [email protected] • Consumer & Auto
Jacqueline KO, CFA (852) 2268 0633 [email protected] • Consumer Staples & Durables
Jessica NG (852) 2268 0678 [email protected] • Utilities & Renewable Energy
Ka Leong LO, CFA (852) 2268 0630 [email protected] • Consumer Discretionary & Auto
Mitchell KIM (852) 2268 0634 [email protected]
• Internet & Telcos
Osbert TANG, CFA (86) 21 5096 8370 [email protected] • Transport & Industrials
Ricky WK NG, CFA (852) 2268 0689 [email protected] • Utilities & Renewable Energy
Steven ST CHAN (852) 2268 0645 [email protected] • Banking & Financials - Regional
Warren LAU (852) 2268 0644 [email protected] • Technology – Regional
INDIA
Jigar SHAH Head of Research
(91) 22 6632 2632 [email protected]
• Oil & Gas • Automobile • Cement
Anubhav GUPTA
(91) 22 6623 2605 [email protected]
• Metal & Mining • Capital Goods • Property
Vishal MODI
(91) 22 6623 2607 [email protected]
• Banking & Financials
Abhijeet KUNDU
(91) 22 6623 2628 [email protected]
• Consumer
Neerav DALAL
(91) 22 6623 2606 [email protected]
• Software Technology • Telcos
Ritesh POLADIA
(91) 22 6623 2612 [email protected]
• Media & Entertainment
SINGAPORE
NG Wee Siang Head of Research (65) 6231 5838 [email protected] • Banking & Finance
Gregory YAP (65) 6231 5848 [email protected] • SMID Caps • Technology & Manufacturing • Telcos
YEAK Chee Keong, CFA (65) 6231 5842 [email protected] • Offshore & Marine
Derrick HENG, CFA (65) 6231 5843 [email protected]
• Transport • Property • REITs (Office)
Joshua TAN (65) 6231 5850 [email protected] • REITs (Retail, Industrial)
WEI Bin (65) 6231 5844 [email protected] • Commodity • Logistics • S-chips
John CHEONG (65) 6231 5845 [email protected] • Small & Mid Caps • Healthcare
TRUONG Thanh Hang (65) 6231 5847 [email protected] • Small & Mid Caps
INDONESIA
Wilianto IE Head of Research (62) 21 2557 1125 [email protected] • Strategy
Rahmi MARINA (62) 21 2557 1128 [email protected] • Banking & Finance
Aurellia SETIABUDI (62) 21 2953 0785 [email protected] • Property
Isnaputra ISKANDAR (62) 21 2557 1129 [email protected] • Metals & Mining • Cement
Pandu ANUGRAH (62) 21 2557 1137 [email protected] • Infra • Construction • Transport• Telcos
Janni ASMAN (62) 21 2953 0784 [email protected] • Cigarette • Healthcare • Retail
Adhi TASMIN (62) 21 2557 1209 [email protected] • Plantations
PHILIPPINES
Luz LORENZO Head of Research (63) 2 849 8836 [email protected] • Strategy • Utilities • Conglomerates • Telcos
Lovell SARREAL (63) 2 849 8841 [email protected] • Consumer • Media • Cement
Rommel RODRIGO (63) 2 849 8839 [email protected] • Conglomerates • Property • Gaming • Ports/ Logistics
Katherine TAN (63) 2 849 8843 [email protected] • Banks • Construction
Ramon ADVIENTO (63) 2 849 8845 [email protected] • Mining
Michael BENGSON (63) 2 849 8840 [email protected]
• Conglomerates
Jaclyn JIMENEZ (63) 2 849 8842 [email protected] • Consumer
Arabelle MAGHIRANG (63) 2 849 8838 [email protected] • Banks
THAILAND
Maria LAPIZ Head of Institutional Research Dir (66) 2257 0250 | (66) 2658 6300 ext 1399 [email protected] • Consumer • Materials • Ind. Estates
Sittichai DUANGRATTANACHAYA (66) 2658 6300 ext 1393 [email protected] • Services Sector • Transport
Sukit UDOMSIRIKUL Head of Retail Research (66) 2658 6300 ext 5090 [email protected]
Mayuree CHOWVIKRAN (66) 2658 6300 ext 1440 [email protected] • Strategy
Padon VANNARAT (66) 2658 6300 ext 1450 [email protected] • Strategy
Surachai PRAMUALCHAROENKIT (66) 2658 6300 ext 1470 [email protected] • Auto • Conmat • Contractor • Steel
Suttatip PEERASUB (66) 2658 6300 ext 1430 [email protected] • Media • Commerce
Sutthichai KUMWORACHAI (66) 2658 6300 ext 1400 [email protected] • Energy • Petrochem
Termporn TANTIVIVAT (66) 2658 6300 ext 1520 [email protected] • Property
Jaroonpan WATTANAWONG (66) 2658 6300 ext 1404 [email protected] • Transportation • Small cap
Chatchai JINDARAT (66) 2658 6300 ext 1401 [email protected]
• Electronics
VIETNAM
NGUYEN Thi Ngan Tuyen, Head of Retail Research (84) 8 44 555 888 x 8081 [email protected] • Food & Beverage • Oil&Gas • Banking
TRINH Thi Ngoc Diep (84) 4 44 555 888 x 8208 [email protected] • Technology • Utilities • Construction
PHAM Nhat Bich (84) 8 44 555 888 x 8083 [email protected] • Consumer • Manufacturing • Fishery
NGUYEN Thi Sony Tra Mi (84) 8 44 555 888 x 8084 [email protected] • Port operation • Pharmaceutical • Food & Beverage
May 19, 2015 23
Malaysia Property
APPENDIX I: TERMS FOR PROVISION OF REPORT, DISCLAIMERS AND DISCLOSURES
DISCLAIMERS
This research report is prepared for general circulation and for information purposes only and under no circumstances should it be considered or intended as an offer to sell or a solicitation of an offer to buy the securities referred to herein. Investors should note that values of such securities, if any, may fluctuate
and that each security‟s price or value may rise or fall. Opinions or recommendations contained herein are in form of technical ratings and fundamental ratings. Technical ratings may differ from fundamental ratings as technical valuations apply different methodologies and are purely based on price and volume-related information extracted from the relevant jurisdiction‟s stock exchange in the equity analysis. Accordingly, investors‟ returns may be less than
the original sum invested. Past performance is not necessarily a guide to future performance. This report is not intended to provide personal investment advice and does not take into account the specific investment objectives, the financial situation and the particular needs of persons who may receive or read this report. Investors should therefore seek financial, legal and other advice regarding the appropriateness of investing in any securities or the investment strategies discussed or recommended in this report.
The information contained herein has been obtained from sources believed to be reliable but such sources have not been independently verified by Maybank
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Malaysia
Opinions or recommendations contained herein are in the form of technical ratings and fundamental ratings. Technical ratings may differ from fundamental ratings as technical valuations apply different methodologies and are purely based on price and volume-related information extracted from Bursa Malaysia Securities Berhad in the equity analysis.
Singapore
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Thailand
The disclosure of the survey result of the Thai Institute of Directors Association (“IOD”) regarding corporate governance is made pursuant to the policy of the Office of the Securities and Exchange Commission. The survey of the IOD is based on the information of a company listed on the Stock Exchange of Thailand and the market for Alternative Investment disclosed to the public and able to be accessed by a general public investor. The result, therefore, is from the
perspective of a third party. It is not an evaluation of operation and is not based on inside information. The survey result is as of the date appearing in the Corporate Governance Report of Thai Listed Companies. As a result, the survey may be changed after that date. Maybank Kim Eng Securities (Thailand) Public Company Limited (“MBKET”) does not confirm nor certify the accuracy of such survey result.
Except as specifically permitted, no part of this presentation may be reproduced or distributed in any manner without the prior written permission of MBKET. MBKET accepts no liability whatsoever for the actions of third parties in this respect.
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This document is being distributed by Maybank Kim Eng Securities (London) Ltd (“Maybank KESL”) which is authorized and regulated, by the Financial Services Authority and is for Informational Purposes only. This document is not intended for distribution to anyone defined as a Retail Client under the Financial Services and Markets Act 2000 within the UK. Any inclusion of a third party link is for the recipients convenience only, and that the firm does not take any
responsibility for its comments or accuracy, and that access to such links is at the individuals own risk. Nothing in this report should be considered as constituting legal, accounting or tax advice, and that for accurate guidance recipients should consult with their own independent tax advisers.
May 19, 2015 24
Malaysia Property
Disclosure of Interest
Malaysia: MKE and its Representatives may from time to time have positions or be materially interested in the securities referred to herein and may further act as market maker or may have assumed an underwriting commitment or deal with such securities and may also perform or seek to perform investment banking services, advisory and other services for or relating to those companies.
Singapore: As of 8 January 2014, Maybank KERPL and the covering analyst do not have any interest in any companies recommended in this research report.
Thailand: MBKET may have a business relationship with or may possibly be an issuer of derivative warrants on the securities /companies mentioned in the research report. Therefore, Investors should exercise their own judgment before making any investment decisions. MBKET, its associates, directors, connected parties and/or employees may from time to time have interests and/or underwriting commitments in the securities mentioned in this report.
Hong Kong: KESHK may have financial interests in relation to an issuer or a new listing applicant referred to as defined by the requirements under Paragraph
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As of 8 January 2014, KESHK and the authoring analyst do not have any interest in any companies recommended in this research report.
MKE may have, within the last three years, served as manager or co-manager of a public offering of securities for, or currently may make a primary market in
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OTHERS
Analyst Certification of Independence
The views expressed in this research report accurately reflect the analyst‟s personal views about any and all of the subject securities or issuers; and no part of the research analyst‟s compensation was, is or will be, directly or indirectly, related to the specific recommendations or views expressed in the report.
Reminder
Structured securities are complex instruments, typically involve a high degree of risk and are intended for sale only to sophisticated investors who are capable
of understanding and assuming the risks involved. The market value of any structured security may be affected by changes in economic, financial and political factors (including, but not limited to, spot and forward interest and exchange rates), time to maturity, market conditions and volatility and the credit quality of any issuer or reference issuer. Any investor interested in purchasing a structured product should conduct its own analysis of the product and consult with its own professional advisers as to the risks involved in making such a purchase.
No part of this material may be copied, photocopied or duplicated in any form by any means or redistributed without the prior consent of MKE.
Definition of Ratings
Maybank Kim Eng Research uses the following rating system
BUY Return is expected to be above 10% in the next 12 months (excluding dividends)
HOLD Return is expected to be between - 10% to +10% in the next 12 months (excluding dividends)
SELL Return is expected to be below -10% in the next 12 months (excluding dividends)
Applicability of Ratings
The respective analyst maintains a coverage universe of stocks, the list of which may be adjusted according to needs. Investment ratings are only
applicable to the stocks which form part of the coverage universe. Reports on companies which are not part of the coverage do not carry investment ratings as we do not actively follow developments in these companies.
DISCLOSURES
Legal Entities Disclosures
Malaysia: This report is issued and distributed in Malaysia by Maybank Investment Bank Berhad (15938-H) which is a Participating Organization of Bursa Malaysia Berhad and a holder of Capital Markets and Services License issued by the Securities Commission in Malaysia. Singapore: This material is issued and distributed in Singapore by Maybank KERPL (Co. Reg No 197201256N) which is regulated by the Monetary Authority of Singapore. Indonesia: PT Kim Eng
Securities (“PTKES”) (Reg. No. KEP-251/PM/1992) is a member of the Indonesia Stock Exchange and is regulated by the BAPEPAM LK. Thailand: MBKET (Reg. No.0107545000314) is a member of the Stock Exchange of Thailand and is regulated by the Ministry of Finance and the Securities and Exchange Commission. Philippines: Maybank ATRKES (Reg. No.01-2004-00019) is a member of the Philippines Stock Exchange and is regulated by the Securities and Exchange
Commission. Vietnam: Maybank Kim Eng Securities JSC (License Number: 71/UBCK-GP) is licensed under the State Securities Commission of Vietnam.Hong Kong: KESHK (Central Entity No AAD284) is regulated by the Securities and Futures Commission. India: Kim Eng Securities India Private Limited (“KESI”) is a participant of the National Stock Exchange of India Limited (Reg No: INF/INB 231452435) and the Bombay Stock Exchange (Reg. No. INF/INB 011452431) and is regulated by Securities and Exchange Board of India. KESI is also registered with SEBI as Category 1 Merchant Banker (Reg. No. INM 000011708) US: Maybank
KESUSA is a member of/ and is authorized and regulated by the FINRA – Broker ID 27861. UK: Maybank KESL (Reg No 2377538) is authorized and regulated by the Financial Services Authority.
May 19, 2015 25
Malaysia Property
Malaysia Maybank Investment Bank Berhad
(A Participating Organisation of
Bursa Malaysia Securities Berhad)
33rd Floor, Menara Maybank,
100 Jalan Tun Perak,
50050 Kuala Lumpur
Tel: (603) 2059 1888;
Fax: (603) 2078 4194
Singapore Maybank Kim Eng Securities Pte Ltd
Maybank Kim Eng Research Pte Ltd
50 North Canal Road
Singapore 059304
Tel: (65) 6336 9090
London Maybank Kim Eng Securities
(London) Ltd
5th Floor, Aldermary House
10-15 Queen Street
London EC4N 1TX, UK
Tel: (44) 20 7332 0221
Fax: (44) 20 7332 0302
New York Maybank Kim Eng Securities USA
Inc
777 Third Avenue, 21st Floor
New York, NY 10017, U.S.A.
Tel: (212) 688 8886
Fax: (212) 688 3500
Stockbroking Business:
Level 8, Tower C, Dataran Maybank,
No.1, Jalan Maarof
59000 Kuala Lumpur
Tel: (603) 2297 8888
Fax: (603) 2282 5136
Hong Kong Kim Eng Securities (HK) Ltd
Level 30,
Three Pacific Place,
1 Queen‟s Road East,
Hong Kong
Tel: (852) 2268 0800
Fax: (852) 2877 0104
Indonesia PT Maybank Kim Eng Securities
Plaza Bapindo
Citibank Tower 17th Floor
Jl Jend. Sudirman Kav. 54-55
Jakarta 12190, Indonesia
Tel: (62) 21 2557 1188
Fax: (62) 21 2557 1189
India Kim Eng Securities India Pvt Ltd
2nd Floor, The International 16,
Maharishi Karve Road,
Churchgate Station,
Mumbai City - 400 020, India
Tel: (91) 22 6623 2600
Fax: (91) 22 6623 2604
Philippines Maybank ATR Kim Eng Securities Inc.
17/F, Tower One & Exchange Plaza
Ayala Triangle, Ayala Avenue
Makati City, Philippines 1200
Tel: (63) 2 849 8888
Fax: (63) 2 848 5738
Thailand Maybank Kim Eng Securities
(Thailand) Public Company Limited
999/9 The Offices at Central World,
20th
- 21st Floor,
Rama 1 Road Pathumwan,
Bangkok 10330, Thailand
Tel: (66) 2 658 6817 (sales)
Tel: (66) 2 658 6801 (research)
Vietnam Maybank Kim Eng Securities Limited
4A-15+16 Floor Vincom Center Dong
Khoi, 72 Le Thanh Ton St. District 1
Ho Chi Minh City, Vietnam
Tel : (84) 844 555 888
Fax : (84) 8 38 271 030
Saudi Arabia In association with
Anfaal Capital
Villa 47, Tujjar Jeddah
Prince Mohammed bin Abdulaziz
Street P.O. Box 126575
Jeddah 21352
Tel: (966) 2 6068686
Fax: (966) 26068787
South Asia Sales Trading Kevin Foy
Regional Head Sales Trading
Tel: (65) 6336-5157
US Toll Free: 1-866-406-7447
North Asia Sales Trading Alex Tsun
Tel: (852) 2268 0228
US Toll Free: 1 877 837 7635
Malaysia Rommel Jacob [email protected]
Tel: (603) 2717 5152
Thailand Tanasak Krishnasreni [email protected]
Tel: (66)2 658 6820
Indonesia Harianto Liong
[email protected] Tel: (62) 21 2557 1177
New York Andrew Dacey
[email protected] Tel: (212) 688 2956
India Manish Modi
[email protected] Tel: (91)-22-6623-2601
Vietnam Tien Nguyen [email protected]
Tel: (84) 44 555 888 x8079
Philippines Keith Roy [email protected]
Tel: (63) 2 848-5288
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