KSL

Friday, 11 October 2013

Top 10 In Property Sector

During the property bull run for the last 5 years, a lot of listed developers' profit grow. Thus, their share price also rise. However, does the rise in share price proportionate with the rise in profit?

After screening through the listed property stocks, actually we can find that some small/mid cap companies are still quite "undervalued" at the moment.

The tables below contain some easy-to-get info of most companies listed in property sector of Bursa KLCI. Some of them are not pure property developers. Some other property developers listed in other sectors and those with annual net profit less than RM15mil will not be included in this list. There is no guarantee that the numbers provided here will be 100% accurate.

The "remark" in the table roughly shows the most recent financial result compared to previous results.

Developers with market cap > RM1 billion

	Stock	Cap (mil)	Price	EPS	PE	Div (sen)	DY%	NTA	Remark
	E&O	2,270	2.00	11.7	17.5	4.5	2.3	1.28	1H13 down
	IGB	3,949	2.65	12.5	21.9	7.5	2.8	2.77	1H13 flat
	IJMLand	4,287	2.75	15.3	19.9	5.0	1.8	1.85	1Q14 up up
	Mahsing	3,372	2.43	27.6	14.6	7.6	3.0	1.50	1H13 up
	SPSetia	7,942	3.23	20.5	20.2	14.0	4.3	2.22	3Q13 up
	Sunway	5,015	2.91	41.2	9.4	6.0	2.1	2.90	1H13 up
	SPB	1,474	4.29	20.1	21.3	10.0	2.3	5.56	3Q13 up
	TAGB	1,439	0.29	1.7	15.6	0.6	2.1	0.47	1H14 up
	Trop	1,678	1.52	32.1	9.9	6.4	4.2	2.45	1H13 up
	UEMS	10,656	2.45	10.4	23.8	3.0	1.2	1.28	1H13 up up
	UOADev	3,202	2.39	24.6	10.6	12.0	5.0	1.80	1H13 up

Developers with market cap RM300 million - RM1 billion

	Stock	Cap (mil)	Price	EPS	PE	Div (sen)	DY%	NTA	Remark
	A&M	336	0.92	7.4	12.4	x	x	1.44	1H13 flat
	Amprop	456	0.785	16.9	4.7	3.0	3.8	1.30	1Q14 down
	Asas	330	1.72	14.3	12.1	5.0	3.0	2.18	1H13 flat
	BJAsset	946	0.85	4.2	20.5	1.5	1.8	1.99	FY13 down
	Cresndo	736	3.23	29.1	13.2	12.0	3.7	3.02	1H14 up up
	Daiman	577	2.72	32.7	8.4	12.0	4.4	4.89	FY13 up up
	Glomac	852	1.17	14.7	8.4	6.5	5.5	1.16	1Q14 up
	Guoco	806	1.15	6.3	19.2	2.0	1.7	1.20	FY13 up up
	Huayang	615	2.33	36.6	8.7	13.25	5.7	1.75	1Q14 down
	Hunzpty	499	2.34	91.6	3.0	5.6	2.4	3.84	FY13 up
	IBHD	311	2.72	14.8	18.5	4.0	1.5	1.62	1H13 up
	KSL	831	2.13	34.1	6.3	x	x	3.16	1H13 up up
	LBS	844	1.80	9.9	22.4	2.5	1.4	1.26	1H13 up
	Magna	350	1.05	5.3	19.8	1.5	1.4	0.54	1H13 up
	Malton	353	0.85	8.5	10.0	2.5	3.0	1.46	FY13 down
	Matrix	860	2.86	34.5	8.3	15.4*	5.4*	1.73	1H13 up
	Medainc	344	0.725	6.2	12.3	2*	2.8*	0.46	1H13 up
	MKH	908	2.60	25.4	12.3	5.0	1.9	2.62	3Q13 up up
	MKLand	435	0.36	3.4	10.7	2.0	5.6	0.91	FY13 up up
	Naim	900	3.60	37.0	10.3	8.0	2.2	3.44	1H13 up
	OSKProp	322	1.32	15.3	10.2	7.5	5.7	1.59	1H13 flat
	Paramon	513	1.52	16.7	9.1	8.0	5.3	2.09	1H13 flat
	PJDev	493	1.08	13.4	8.1	5.0	4.6	2.12	FY13 up
	Plenitud	613	2.27	28.8	7.9	6.0	2.6	3.37	FY13 up
	SDRED	384	0.90	11.3	8.0	2.25	2.5	1.53	1Q14 down
	SHL	518	2.14	14.2	15.0	12.0	5.6	2.43	1Q14 up
	Symlife	335	1.08	32.7	3.9	3.0	2.8	1.94	1Q14 up
	TAHPS	419	5.60	19.6	28.5	20.0	3.6	5.99	1Q14 up up
	Tambun	486	1.44	14.9	11.9	9.1	6.3	0.76	1H13 up
	WingTM	831	2.55	42.1	6.3	10.0	3.9	3.22	FY13 up up
	YNHProp	775	1.82	12.1	15.6	3.5	1.9	2.03	1H13 flat
	YTLLand	827	0.98	3.0	32.8	x	x	1.18	FY13 flat

Developers with market cap < RM300 million

	Stock	Cap (mil)	Price	EPS	PE	Div (sen)	DY%	NTA	Remark
	Asiapac	137	0.14	1.8	7.8	x	x	0.35	1Q14 up
	BCB	138	0.67	8.2	8.4	x	x	1.75	FY13 up up
	CHHB	284	1.03	8.9	11.6	x	x	2.81	1H13 up up
	Cview	223	2.23	38.0	5.9	14.0*	6.3*	2.01	1H13 up up
	Eupe	95	0.745	11.6	6.4	2.0*	2.7*	2.06	1Q14 down
	Gromutual	163	0.435	5.9	7.3	1.5	3.4	0.74	2Q14 up
	GOB	182	0.80	13.4	6.0	x	x	1.12	1Q14 flat
	Ivory	261	0.585	8.8	8.1	x	x	0.83	1H13 down
	Keladi	193	0.255	7.0	3.7	0.5	2.2	0.34	1H13 flat
	Ken	144	1.50	18.3	8.7	6.0	4.0	1.77	1H13 down
	L&G	215	0.36	7.4	4.9	x	x	0.56	1Q14 up
	LienHoe	119	0.33	27.5	1.3	x	x	0.77	1H13 loss
	Menang	159	0.60	6.5	9.2	x	x	0.67	loss to profit
	Sapres	131	0.94	22.1	4.2	8.6	9.2	2.43	1H13 flat
	SBCcorp	138	1.68	32.5	5.2	4.0	2.4	3.59	1Q14 flat
	Sentoria	277	0.63	12.7	5.8	14.0	1.6	0.48	3Q13 down
	Y&G	108	0.70	3.2	21.9	x	x	1.11	1H13 flat

x - not dividend declared
* - dividend not fully declared for the FY

Those companies with low PE ratio in the list are likely to be undervalued. However, the EPS and PE for the latest full financial year may not give us the true picture, as some of the figures are affected by one-off extraordinary gain or loss during the financial year under review.

The tables do not include other important financial ratio such as ROE, gearing etc. Readers are advised to do their own homework to find out more.

With the numbers available here, lets derive some Top 10 companies for fun.

Top 10 Largest Market Capitalization

	Rank	Company
	1	UEMS
	2	SP Setia
	3	Sunway
	4	IJM Land
	5	IGB
	6	Mahsing
	7	UOA Dev
	8	E&O
	9	Tropicana
	10	Selangor Prop

Top 10 Companies with Lowest PE Ratio

	Rank	Company	PE x
	1	Lien Hoe	1.3
	2	Hunza	3.0
	3	Keladi	3.7
	4	Symphony Life	3.9
	5	Sapura	4.2
	6	Amcorp Prop	4.7
	7	L&G	4.9
	8	SBC Corp	5.2
	9	Sentoria	5.8
	10	Country View	5.9

Most of the low PE ratio in the table above are not "justifiable" due to one-off gain and these companies may not be able to match the financial result for the next financial year.

Top 10 Companies with "Justifiable" Low PE ratio

	Rank	Company	PE x
	1	L&G	4.9
	2	SBC Corp	5.2
	3	Country View	5.9
	4	KSL	6.3
	4	WingTai	6.3
	5	Gromutual	7.3
	6	Selangor Dredg	8.0
	7	PJDev	8.1
	8	Matrix	8.3
	9	BCB	8.4
	9	Daiman	8.4
	9	Glomac	8.4
	10	Huayang	8.7

In my opinion, the low PE ratio of the companies in the table above may be a more accurate representative of its true value.

Top 10 Dividend Yield

	Rank	Company	DY%
	1	Country View	6.3*
	1	Tambun	6.3
	2	Huayang	5.7
	2	OSK Prop	5.7
	3	MK Land	5.6
	3	SHL	5.6
	4	Glomac	5.5
	5	Matrix	5.4*
	6	Paramount	5.3
	7	UOA Dev	5.0
	8	PJDev	4.6
	9	Daiman	4.4
	10	SP Setia	4.3

The dividend yield of Sapura Resources (9.2%) is not included in the list as it is likely not sustainable. There are some companies that give bonus issue or share dividend. These are not included in the calculation of dividend yield as well. Some of the dividend are tax-exempted and some are not...

Most of the property developers carry a lot of land with them. Thus their net asset per share is usually high, although these land may not be re-evaluated for a long time. At this moment, there are a lot of companies listed in property sector trading way below their published NTA.

Top 10 Companies with share price lag behind NTA

	Rank	Company	Lag%
	1	EUPE	177
	2	CHHB	173
	3	BCB	161
	4	Sapura	159
	5	MK Land	153
	6	Asiapac	150
	7	BJ Assets	134
	8	LienHoe	133
	9	SBC Corp	114
	10	PJ Dev	96

Other Prominent Property Developers Not Listed In Property Sector

	Stock	Cap (mil)	Price	EPS	PE	Div (sen)	DY%	NTA	Remark
	Gamuda	1,0767	4.72	25.4	19.9	12.0	2.5	2.14	FY13 flat
	IOICorp	3,4701	5.39	30.8	17.6	15.5	2.9	2.14	FY13 up
	MRCB	2,460	1.49	4.3	40.9	2.0	1.3	1.03	1H13 down
	Scientex	1,258	5.47	51.0	11.4	26.0	4.8	2.84	FY13 up
	SIME	57,090	9.50	61.6	15.4	34.0	3.6	4.51	FY13 down
	WCT	2,676	2.46	38.6	7.3	7.0	2.8	1.95	1H13 down

If solely base on PE, DY and recent financial results, we can rate these property developers as below:

Outstanding: 

• Country View
• Glomac
• Huayang
• Matrix
• PJDev

Attractive: 

• Daiman
• Gromutual
• KSL
• L&G
• MK Land
• OSK Prop
• Paramount
• SBC Corp
• Tambun
• UOA Dev
• WingTai

You should study the balance sheet, financial ratios and competitiveness of these companies to determine which is the best property stock. Of course those big cap developers are not bad too, and their higher range of PE is a norm to them.