The Edge reported over the weekend that prospects are looking up for the Penang property market. Although we were aware of the good response to recent launches in Penang, we are surprised that demand for properties there has been as strong, if not stronger than, in the Klang Valley. The positive outlook for the Penang property market reinforces our bullish stance on the Malaysian property sector.
We maintain our TRADING BUY call on the sector and all developers under our coverage. Our preferred exposure to Penang is E&O as it has the makings of the biggest winner in the Penang island property boom. E&O has lined up RM1.8bn worth of condos in Seri Tanjung Pinang to be launched starting Oct. Should response be good, it would lock in profits and earnings visibility for the next 3-4 years. E&O remains our top pick in the property sector.
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