Mah Sing is continuing with its aggressive and transformational landbanking exercise that should catapult it into the big league. We believe it is ripe for a major re-rating given its excellent track record in execution and wildly successful “quick turnaround” model. We are raising our FY11-12 FD EPS by 1-3% as contributions from its recently acquired landbank should more than offset the dilution from the convertible bonds.
Our target price is raised from RM2.35 to RM3.30 as we now value the stock at our target market P/E of 14.5x instead of a 20% discount in view of its strong EPS CAGR of 31% and robust landbanking newsflow. Mah Sing is now our top pick in the property sector. We maintain our BUY rating given the catalysts of 1) accelerating earnings, 2) strong landbanking newsflow, and 3) record sales in 2010/11.
Our target price is raised from RM2.35 to RM3.30 as we now value the stock at our target market P/E of 14.5x instead of a 20% discount in view of its strong EPS CAGR of 31% and robust landbanking newsflow. Mah Sing is now our top pick in the property sector. We maintain our BUY rating given the catalysts of 1) accelerating earnings, 2) strong landbanking newsflow, and 3) record sales in 2010/11.
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