Highlight UEM Sunrise upgraded on Australian deal

by **Cals** Sat 05 Dec 2015, 00:00

Highlight

[size=28]UEM Sunrise upgraded on Australian deal

By Chong Jin Hun / theedgemarkets.com | December 4, 2015 : 9:00 AM MYT

KUALA LUMPUR (Dec 4): MIDF Amanah Investment Bank Bhd upped its target price (TP) for UEM Sunrise Bhd ([You must be registered and logged in to see this image.]Valuation: 2.60, Fundamental: 1.50) shares to RM1.11 from RM1.10 after the property developer said it was selling apartments in Melbourne, Australia, for A$120 million (RM370.8 million).

Yesterday, UEM Sunrise said it was selling 252 serviced apartments to Ascendas Australia Hotel Trust. The 252 serviced apartments form a portion of UEM Sunrise's Aurora Melbourne Central mixed development along La Trobe Street.

UEM Sunrise has market capitalisation of RM5.08 billion based on its latest closing share price of RM1.12.

Today, MIDF analyst Alan Lim wrote in a note its higher TP for UEM Sunrise took into account the company's future profit.

Lim said including the Melbourne deal, UEM Sunrise was expected to achieve its RM2 billion property sales target for financial year ending Dec 31, 2015.

"We are positive on the news as UEMS (UEM Sunrise) will be able to focus its resources on marketing and selling its other Melbourne projects. Note that managing serviced apartments is not the core business of UEMS.

"As UEMS has achieved sales of RM1.18b in 9MFY15, cumulative sales (including the sale of serviced apartments for RM371m) will be RM1.56b. This makes up 80%/78% of our/management sales target of RM1.95b/RM2.00b for FY15. Hence, we believe that UEMS is on track to achieve its full year sales target," Lim said.

(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)
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