STOCK FOCUS OF THE DAY
Sunway City : Massive unsold stocks and possible REIT delay HOLD
We are initiating coverage on Sunway City Bhd (Suncity) with a HOLD rating and fair value of RM3.45/share based on 25% discount to our NAV estimate of RM4.60/share. Primary catalyst for Suncity continues to centre on the potential monetisation of its large portfolio of investment properties worth an estimated RM3bil - RM4bil via a REIT. We are forecasting earnings of RM175mil in FY09F (18 months) and RM139mil in FY10F. We have assumed dividend payout ratio of 20%, translating to a dividend of 5 sen - 6 sen/share over FY09F-11F. Management's decision to diversify its assets for the REIT is not appealing and we expect there will be continued delays in the listing of its REIT unit.
QUICK TAKES
Guinness Anchor : Maintaining the lead into FY10F BUY
Kulim Bhd : To sell stake in PNG? BUY
Construction Sector : PORR back on the cards? overweight
NEWS HIGHLIGHTS
IJM Plantation : Eyes downstream activities in India venture
Sime Darby : Stake offered to China?
Property Sector : Cash-rich AEON scraps REIT plan
AmFraser Research
Mobileone : Qala buy to boost strength in corporate broadband BUY
ComfortDelGro Corp Ltd : Growth opportunities support long-term prospects BUY
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