LBS BINA GROUP BHD

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By JF Apex Se­cu­ri­ties Bhd Rating: Buy (Main­tained) Tar­get price: RM2.50

JF Apex main­tained a “buy” rating on LBS Bina Group Bhd with a higher tar­get price of RM2.50 (pre­vi­ously RM2.27) based on 30% dis­count to its reval­ued net as­set value/share of RM3.57 (up­ward re­vi­sion from RM3.49 af­ter fac­tor­ing in LBS Bina’s project in Seri Kem­banga with po­ten­tial GDV of RM600mil, higher val­u­a­tion in its 51% stake in ML Global, fol­low­ing ris­ing share price, and the im­pact of RCPS.

LBS Bina’s stronger y-o-y per­for­mance in third quar­ter of 2017 and nine months of 2017 bot­tom line was at­trib­ut­able to bet­ter top line, as un­der­pinned by its ex­ist­ing projects namely Ban­dar Sau­jana Pu­tra, D’Is­land Res­i­dence, Ban­dar Putera In­dah, Si­naran Mahjota, Mid­hills, De­siran Bayu and Zenopy Res­i­dences.

JF Apex said LBS Bina chalked up RM1.3bil new sales as of end-Novem­ber 2017 (up 18% y-o-y against RM1.1bil as of end Novem­ber 2016), which ac­counted for 89% of the man­age­ment’s full year new sales tar­get of RM1.5bil.

“New sales achieved from Jan­uary till Novem­ber 2017 were mainly con­trib­uted by Ban­dar Sau­jana Pu­tra and re­cently launched Alam Per­dana in the Klang Val­ley, as well as Mid­hills in Gent­ing High­lands,” JF Apex noted.

The group’s un­billed sales are still re­silient, in­creas­ing fur­ther to RM1.6bil as of Oct 2017 or equiv­a­lent to 1.6 times of its 2016 topline.

Ac­cord­ing to JF Apex, LBS Bina plans to repli­cate the suc­cess of its flag­ship township, Ban­dar Sau­jana Pu­tra in Alam Per­dana.

The prop­ery de­vel­oper will be fo­cus­ing on af­ford­able homes un­der this project.

Lo­cated in Ijok, Alam Per­dana is a 470-acre lease­hold township de­vel­op­ment that will be de­vel­oped over eight phases. It has a GDV of RM2.9bil.

The township’s first two de­vel­op­ments, Sim­foni Per­dana and Irama Per­dana, have gained pos­i­tive re­sponse from home buy­ers.

Un­der Sim­foni Per­dana, LBS Bina has launched 168 units of two-storey town­houses worth GDV of RM65mil (gross built-up area from 1,191 sq ft) with com­pet­i­tive pric­ing of RM369,000 per unit. Mean­while, for Irama Per­dana, the group has launched 349 units of two-storey houses (GDV of RM170mil) and is about to launch an­other 324 units (GDV of RM161mil) to cope with the strong de­mand. Av­er­age built-up area for Irama Per­dana is 1,208 sq ft with af­ford­able pric­ing of RM480,000 per unit. Be­sides, LBS Bina tar­gets to launch a block of ser­viced apart­ment named Res­i­densi Bin­tang in Bukit Jalil project which con­sists of 730 units worth GDV of RM500mil.

Built-up ar­eas range from 803 sq ft to 1006 sq ft with RM545,000 to RM650,000 per unit.

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