MATRIX (5236) - Matrix Concepts Holdings - Replenishing Sendayan TechValley Land
13 Mar 2015, 01:45 PM
We are upbeat on Matrix’s latest acquisition of 79 acres of land. Maintain BUY, with a higher TP of MYR3.48 (19% upside) based on a 20% discount to RNAV. Given its land cost of MYR8 psf and estimated infrastructure and conversion cost of MYR7 psf, Matrix will be able to retain a 55-60% gross margin by selling the industrial land plots. We expect more news flow on land disposal deals in the coming months.
Adding 79 acres to landbank. Matrix Concepts (Matrix) announced its acquisition of 79 acres of freehold agricultural land yesterday for a total consideration of MYR27.5m. The purchase will be funded internally.
Lucrative margin for industrial land sales. This land, which will be called Sendayan TechValley 3 (STV 3), is an extension to STV 2, as it is just next to the latter. The land cost of MYR8 psf is attractive in our view. In Sep 2014, Matrix acquired 164 acres of industrial land (Sendayan Industrial Park) at MYR10 psf. The price is higher as the land has already been granted industrial status. Given the cost of MYR8 psf for this latest piece of land and management’s estimated infrastructure and conversion cost of MYR7 psf, Matrix will be able to retain a 55-60% gross margin based on an ASP of MYR40 psf, the going price for the industrial land plots there. Minimal infrastructure is needed – as infrastructure works at STV 2 have already been completed – and power and water supply connections can easily be made.
Forecasts. We make no changes to our FY15-17 earnings forecasts. STV 3 will be subdivided and sold progressively in the future.
Maintain BUY with higher TP of MYR3.48. We continue to like the counter, given Matrix’s exposure to the industrial segment and high dividend yield. As we impute the latest acquisition into our RNAV, our TP is raised to MYR3.48 (from MYR3.36), based on a 20% discount to its RNAV. Matrix is still a BUY.
Financial Exhibits
Financial Exhibits
SWOT Analysis
Company Profile
Matrix Concepts is a Negeri Sembilan-based developer that currently has 2,732 acres of land with a total portfolio GDV of MYR8.2bn. The group concentrates mainly on developing residential and commercial properties, as well as industrial land sales.
Source: RHB
13 Mar 2015, 01:45 PM
We are upbeat on Matrix’s latest acquisition of 79 acres of land. Maintain BUY, with a higher TP of MYR3.48 (19% upside) based on a 20% discount to RNAV. Given its land cost of MYR8 psf and estimated infrastructure and conversion cost of MYR7 psf, Matrix will be able to retain a 55-60% gross margin by selling the industrial land plots. We expect more news flow on land disposal deals in the coming months.
Adding 79 acres to landbank. Matrix Concepts (Matrix) announced its acquisition of 79 acres of freehold agricultural land yesterday for a total consideration of MYR27.5m. The purchase will be funded internally.
Lucrative margin for industrial land sales. This land, which will be called Sendayan TechValley 3 (STV 3), is an extension to STV 2, as it is just next to the latter. The land cost of MYR8 psf is attractive in our view. In Sep 2014, Matrix acquired 164 acres of industrial land (Sendayan Industrial Park) at MYR10 psf. The price is higher as the land has already been granted industrial status. Given the cost of MYR8 psf for this latest piece of land and management’s estimated infrastructure and conversion cost of MYR7 psf, Matrix will be able to retain a 55-60% gross margin based on an ASP of MYR40 psf, the going price for the industrial land plots there. Minimal infrastructure is needed – as infrastructure works at STV 2 have already been completed – and power and water supply connections can easily be made.
Forecasts. We make no changes to our FY15-17 earnings forecasts. STV 3 will be subdivided and sold progressively in the future.
Maintain BUY with higher TP of MYR3.48. We continue to like the counter, given Matrix’s exposure to the industrial segment and high dividend yield. As we impute the latest acquisition into our RNAV, our TP is raised to MYR3.48 (from MYR3.36), based on a 20% discount to its RNAV. Matrix is still a BUY.
Financial Exhibits
Financial Exhibits
SWOT Analysis
Company Profile
Matrix Concepts is a Negeri Sembilan-based developer that currently has 2,732 acres of land with a total portfolio GDV of MYR8.2bn. The group concentrates mainly on developing residential and commercial properties, as well as industrial land sales.
Source: RHB
