OCR (7071) OCR GROUP BHDThe ONE Property Stock That Everyone Misses

OCR (7071) OCR GROUP BHDThe ONE Property Stock That Everyone Misses

Since the introduction of Budget 2022 – which has not even passed the 3rd reading yet, property stocks were generally hammered down due to lack of catalysts in 2022, and the new virus variant just made it worse. And this is precisely why people had missed this stock right under their radar.

And this stock is the underdog in property segment – OCR GROUP BERHAD.

The company is currently trading at 23.0 cents NTA, which is -30.43% discount on the current share price of 16.0 cents. But discount is not all for this company.

To date, OCR had more than 20 years of experience in the property development, construction and project management consultation (PMC) businesses, and the group had completed over 17 projects with over RM1.0 billion in GDV. Some of the ongoing projects you might have came across includes The Mate in Selangor, Isola @ KLCC, Selayang Industrial Park, and PRIYA Kuantan.

You see, most developers had a plug-and-play model in property development, where they only focus on one type of property development projects, and if the sub-segment is highly competitive, they will suffer. However, this is not the case for OCR. Based on the ongoing projects as well as some projects in the pipeline, OCR is easily one of the most agile property developer market. For example, the group would target the masstige market, a.k.a. Tier-2 hotspots in Klang Valley area instead of fighting head-to-head with the big boys. As a result,  Isola @ KLCC and PRIYA Kuantan had over 85% take up rate to date.

OCR also stands out from it peers with its involvement in the ECRL, specifically in the Pahang part – which is the longest part in ECRL. The company had signed a MoU with Perbadanan Kemajuan Negeri Pahang to provide consultation and assistance on Pahang local authority matters and sourcing of suppliers and contractors to meet local content requirements. In fact, the company had an effective stake of 28% in the said joint venture company, and this is expected to bode well for the group once ECRL work official restarted.

And as we know the market is moving towards affordable housing, the group had also a joint venture with Yayasan Pahang to project manage over 25,000 units of affordable homes over the next 15 years. Unlike property development and construction segment of the group, the PMC is more of a pure bottom-line/cash flow generator for them, as the costs incurred are minimal.

Also, the company had a Shah Alam Project in the pipeline, and it will be the single largest project in terms of GDV for the group, which will be at least RM750.0 million. The company had 26.9 acres of land along Persiaran Mohktar Dahari and it is expected to build over 2800 units of affordable homes alongside with a commercial component in the project.

With all the ongoing projects with a total RM325.0 million and over RM1.0 billion GDV worth of projects in their pipeline, the company is only trading at RM109.0 million in market value. Set aside the earnings potential, even the NTA had paid for the company itself. I strongly that believe the value for the company will justify itself in 2022.

Cheers.

https://klse.i3investor.com/blogs/fireinvsting/2021-12-02-story-h1594762780-The_ONE_Property_Stock_That_Everyone_Misses.jsp