RHB Retail Research

Author: rhboskres   |   Latest post: Wed, 25 Nov 2020, 5:46 PM


MCT - No Surprises in the Downward Trend

Author:   |    Publish date:

  • Maintain NEUTRAL with new MYR0.21 TP from MYR0.26, 5% expected total return. A pick-up in construction progress lifted the group’s topline for the quarter but core net profit dipped 29.4% YoY. Nevertheless, earnings came in line with our expectations. Public spread is still a cause for concern, as the current level of 24% is still short of the listing requirements. Share price has fallen >70% YTD from MYR0.75 at the start of the year.
  • Earnings met expectations. 9M19 core net profit of MYR26.9m came in within expectations, at 75% of our full-year estimates. 3Q19 revenue rose 11.5% YoY (+31.5% QoQ), attributed to the pick-up in the construction progress for all of its projects – with the aim of handing over 3,000 units across four projects by 1H20. 3Q19 core net profit, on the other hand, decreased 29.4% YoY and >100% QoQ from higher interest, and unrealised forex loss of MYR2m.
  • Marginal decrease in unbilled sales. The latest unbilled sales amount as at 3Q19 stood at MYR672m, a dip of c.3% from last quarter’s MYR692m. As some launches are likely to be delayed to next year, we expect unbilled sales to deplete further in the coming quarters.
  • Launches for 4Q19 delayed. MCT has several projects at Lakefront in the Cybersouth township in Cyberjaya – with the focus on residential properties priced between MYR250,000 and MYR700,000, and some commercial units to complement the said projects. These projects were slated to be launched in 4Q19, but have been delayed to 1Q20 pending approvals from the authorities. The first phase of the group’s project on the newly acquired land in Subang Jaya, initially expected to launch by 4Q19, has also been delayed.
  • Public spread still below requirements as of November. Unchanged from the public spread announced back in August, MCT’s public shareholding spread still stands at 24.59% – below the public shareholding spread requirement of at least 25%. Plans to resolve this issue include discussions with MCT’s major shareholders on the possibility of selling down their shareholdings, engagements with investment banks on private placement exercises to those deemed public and increased communication with potential investors, analysts, research houses, and shareholders to instil confidence.
  • Slash TP by 19%, maintain forecasts. We maintain our earnings forecasts as the results reported were as expected. Our new TP is based on a larger discount to RNAV of 80% from 75% to reflect our concerns over the group’s shareholding spread, management reshuffling, and delays in launches

Source: RHB Securities Research - 22 Nov 2019

Share this
Labels: MCT

Related Stocks

Chart Stock Name Last Change Volume 
MCT 0.165 0.00 (0.00%) 1,153,900 

  Be the first to like this.

I3 Messenger
Individual or Group chat with anyone on I3investor
MQ Trader
Stock Screener using Technical and Fundamental criteria
MQ Affiliate
Join the MQ Affiliate Program today to earn rewards

782  345  529  514 

Top 10 Active Counters
 AT 0.20+0.03 
 VIVOCOM 0.805-0.05 
 IRIS 0.355+0.055 
 KANGER 0.180.00 
 EAH 0.035+0.005 
 XDL 0.070.00 
 ASIABIO-OR 0.010.00 
 KNM 0.205-0.005 
 KSTAR 0.305-0.03 
 AT-WC 0.20+0.045 


1. The Equity Market Index Benchmark in Malaysia CMS
2. Trading Scenarios of Derivatives Bursa Derivatives Education Series
3. Derivatives 101 Bursa Derivatives Education Series
4. Why Trade FKLI? Bursa Derivatives Education Series
5. MQ Trader - Introduction to MQ Trader Affiliate Program MQ Trader Announcement!


1. Jaks Resources - Jaks Hai Duong Power Plant Achieved Commercial Operation Date (COD) !!! DK
2. Kelington Group Berhad ("KGB") - Above Expectations (TP: RM2.30; +35% upside) by Kenanga Research Investment Ideas - Value and Growth
3. Should we buy Top Glove since it has been plunging due its 28 factories shut down? Koon Yew Yin Koon Yew Yin's Blog
4. All glove stocks dragged down by Top Glove - Koon Yew Yin Koon Yew Yin's Blog
5. 【Growth成长股】AWC Berhad (7579) – Benefit from Strong Order Book Amounted Close to RM1Bil Sanitize and Disinfection Healthcare Stocks
6. TOPGLOV Factory closure to push GLOVEs ASP? gloveharicut
7. ATS (0072) - The Most Under-Valued Glove Maker The Gloves Century Rally
8. Tan Sri Dr Lim: Top Glove estimates dividend yield to be more than 6% in FY21 gloveharicut