Massive jump in FY16 earnings as contribution from Battersea Power Station comes in earlier than expected.
Cut FY14/15 earnings forecasts by -27%/-6% but raise FY16 by +42%.
Our TP is raised to MYR3.47 (on 0.7x P/RNAV); maintain HOLD. Potential asset injection by PNB is a catalyst.
Meanwhile, progress billings of BPS’ Circus West (phase 1 of BPS) is stronger-than-expected. Circus West is likely to be completed by 3QFY16, instead of end-2016/early-2017 as guided earlier.
While there is on-going concern on SPSB’s management succession plan, share price should be supported by its huge unbilled sales of MYR10.4b as at Apr 2014 (2.1x of our FY15 revenue forecast).
Source: Maybank Research - 12 Sep 2014
Cut FY14/15 earnings forecasts by -27%/-6% but raise FY16 by +42%.
Our TP is raised to MYR3.47 (on 0.7x P/RNAV); maintain HOLD. Potential asset injection by PNB is a catalyst.
What’s New
SPSB’s 9MFY14 (FYE Oct) results, which will be released next week, are likely to be below our expectation. 3QFY14 net profit could come in at around MYR100-110m (+40% QoQ, +2% YoY) lifting 9MFY14 core net earnings to MYR241-251m (-13% to -17% YoY), just 56-58% of our full-year estimate. The underperformance could be due to higher-than-expected recognition of GST financial impact. As at Jun 2014, SPSB has locked in new property sales of MYR3.4b, on track to meet its sales target of MYR5b for FY14.Meanwhile, progress billings of BPS’ Circus West (phase 1 of BPS) is stronger-than-expected. Circus West is likely to be completed by 3QFY16, instead of end-2016/early-2017 as guided earlier.
What’s Our View
We cut our FY14/15 earnings forecasts to factor in higher-thanexpected GST provisions but upgrade FY10/16 earning to incorporate the earlier-than-expected profit recognition from Circus West. Our RNAV estimate is raised to MYR4.96 (+17sen).While there is on-going concern on SPSB’s management succession plan, share price should be supported by its huge unbilled sales of MYR10.4b as at Apr 2014 (2.1x of our FY15 revenue forecast).
Source: Maybank Research - 12 Sep 2014
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