Highlights

Kenanga Research & Investment

Author: kiasutrader   |   Latest post: Fri, 18 Jun 2021, 10:01 AM

 

Sunway Berhad - FY20 Within Expectations

Author:   |    Publish date:


4QFY20 CNP of RM244m brought FY20 CNP to RM355m – within our and consensus forecasts. Sales of RM1.3b also met our/management’s target of RM1.2b/1.1b. That said, the 1.5 sen dividend is subpar. With ongoing vaccination efforts, we anticipate their property investment division to see a gradual recovery ahead. Revise FY21E earnings lower (by 3%) post update for Suncon’s estimates. Keep MP on marginally higher SoP-TP of RM1.55 post housekeeping.

Within expectations. Bumper 4QFY20 CNP of RM244m (+266% QoQ; +30% YoY) lifted FY20 CNP to RM355m (-44% YoY) – within our and consensus expectations at 98% each of full-year estimates. Note that the bumper profit this quarter was due to the lump sum recognition worth RM182.5m from Sunway Gardens Tianjin and River Cove Residence Singapore which were recognised upon completion. That said, the 1.5 sen dividend declared is below our 3.7 sen forecast.

FY20A property sales of RM1.3b (effective RM1.0b) met our RM1.2b target. Current unbilled sales of RM2.5b (effective RM1.9b) provide c.3x cover. For FY21, management is targeting sales of RM1.6b (effective RM1.4b) – the same as ours. This target is backed by launches worth RM2.8b (40% local: 60% overseas i.e. Singapore and China).

Highlights. QoQ, 4QFY20 CNP of RM244m surged 266% mainly due to the jump in JV contributions (+992%) attributable to the lump sum recognitions from its China and Singapore developments as explained above. FY20 CNP of RM355m plunged 44% YoY due to the Covid-19 pandemic which saw all their business divisions recording weaker bottom-line contributions (save for the bumper profit recognition for its property development division).

Anticipating a recovery. With vaccination efforts underway, we believe its worst hit division, the leisure and hospitability segment i.e. theme parks and hotel parked under its property investment division, should gradually improve from 2HFY21. Note that its property investment division has been contributing an average profit of RM230m/annum (from 2015- 2019) against a loss of RM31m seen in FY20.

Revise FY21E earnings lower by 3% after updating the lower earnings for Suncon. Meanwhile, we introduce FY22E earnings of RM554m backed by property sales of RM1.6b.

Maintain MP with marginally higher SoP-derived TP of RM1.55 (from RM1.54) post year-end house-keeping. We note that its share price has rebounded well in the past two months and has recovered back to pre-Covid-19 levels. We opine that the next set of catalysts to bring the group to new levels hinges on the performance of its healthcare division and its subsequent listing.

Source: Kenanga Research - 1 Apr 2021

Share this
Labels: SUNWAY

Related Stocks

Chart Stock Name Last Change Volume 
SUNWAY 1.69 -0.08 (4.52%) 10,892,000 

  Be the first to like this.
 
RainT READ
03/04/2021 5:10 PM


APPS
I3 Messenger
Individual or Group chat with anyone on I3investor
MQ Trader
View candlestick stock charts with Technical indicators
MQ Affiliate
Be rewarded by being an MQ Affiliate
 
 

572  344  555 

ActiveGainersLosers
Top 10 Active Counters
 NameLastChange 
 FINTEC 0.035+0.005 
 MMAG 0.185-0.005 
 VSOLAR 0.02+0.005 
 EURO 1.10-0.11 
 MTOUCHE 0.090.00 
 SERBADK 0.625-0.005 
 HHHCORP 0.190.00 
 MRDIY 3.900.00 
 FOCUS 0.04+0.005 
 EDARAN 1.17+0.265 

FEATURED POSTS

1. MQ Trader - Introduction to MQ Trader Affiliate Program MQ Trader Announcement!

TOP ARTICLES

1. What Professor Dennis Etler said about China - Koon Yew Yin Koon Yew Yin's Blog
2. UNCOMMON ACTIVITIES SPOTTED ON RECENT CORPORATE EXERCISE OF THIS COMPANY!! Swim With Sharks
3. [MUST READ] Important message for all investors who are planning to invest in AT or existing AT shareholders Important message for all investors who are planning to invest in AT or existing AT shareholders
4. TENAGA and TENAGA-C85 i3gambler
5. Singapore sees first day rush for Sinovac vaccine; as 16 Covid-19 cases announced on Friday (June 18) Good Articles to Share
6. BioNTech Covid-19 shots have stronger antibody response than Sinovac, Hong Kong study shows Good Articles to Share
7. [转贴] [Video:浅谈EDARAN BHD, EDARAN, 5036] - James的股票投资James Share Investing James的股票投资James Share Investing
8. Serba Dinamik rombak struktur Lembaga Pengarah, lantik IIlyas Pakeer sebagai pengerusi Oil and Gas Malaysia News
PARTNERS & BROKERS