LBS off to a good start, meeting 16% of sales target

PETALING JAYA: LBS Bina Group Bhd is off to a good start to the year, having secured 16% of the company’s RM1.8bil sales target for 2018 in just two months.

JF Apex Securities said in a report that the property developer had successfully chalked up RM293mil in new sales for the first two months of the year, mainly driven by its Bukit Jalil project.

“We are impressed with the figure as market response during early of the year is typically soft due to spending constraints in relation to Chinese New Year celebration, with January and February sales traditionally contributing between 8% and 13% of its actual sales for the past three years.”

For this year, the company plans to launch eight new projects with total gross development value (GDV) worth RM2.2bil, said JF Apex Securities.

“These include Bandar Saujana Putra (BSP) 6 and Rumah Selangorku, PPA1M Mercu Jalil and Residensi Bintang in Bukit Jalil, Alam Perdana PPA1M and landed residences, CyberSouth in Dengkil as well as affordable housings in Batu Pahat, Johor.

“This is in addition to the few on-going projects to be carried forward to 2018 with estimated GDV of RM1.4bil. LBS Bina shares closed one sen up to RM1.03 yesterday.

Meanwhile, CIMB Research believes more launches of mid-priced landed properties would help LBS Bina to achieve a higher 2018 sales target of RM1.8bil. “The group plans to launch more landed houses this year and aims for this segment to comprise around 40% of total GDV in 2018. With January and February 2018 new property sales making up 16% of its 2018 target, the group is on track to achieve its full-year sales target if the strong sales momentum continues, in our view,” it said.

PublicInvest Research said LBS Bina’s 2017 net profit of RM103.4mil was within expectations at 96% of the research house’s full-year estimates, adding however that earnings were slightly below consensus at 94%. “Revenue growth was similarly robust, up 37.1% year-on-year to RM1.36bil, underpinned by healthy unbilled sales which are now at RM1.42bil.

“With the group already making early headway toward achieving its 2018 sales target of RM1.8bil, earnings visibility should be secure for the next two years at the very least.

“While some minor house-keeping changes see 2018 and 2019 estimates lowered by an average 4%, we remain affirmed of LBS Bina’s investment merits and continue to like it for its entrenched position as a leading player in the domestic mass-market affordable housing segment,” said PublicInvest.