KUALA LUMPUR: Mah Sing Group Berhad is on track to surpass its sales target of RM2.5 billion for the fiscal year 2024 (FY24), driven by strong sales of affordable homes and impressive take-up rates exceeding 90 per cent.
AmInvestment Bank Bhd (AmInvest) noted that these sales are bolstered by several launches, including M Aspira and Residensi Suria Madani in Taman Desa, M Azura in Setapak, M Terra in Puchong, M Tiara in Johor Bahru, M Sinar Southville City in Bangi, M Zenya in Kepong, and M Legasi in Semenyih.
"Year-to-date, Mah Sing has secured new sales of RM1.7 billion, attaining 66 per cent of its FY24 sales target of at least RM2.5 billion.
"It launched RM2 billion worth of properties in the first eight months of FY24, accounting for 71 per cent of its FY24 planned launches of RM2.8 billion," AmInvest said in a research note.
AmInvest said that the new sales' contribution to revenue is expected to increase once projects advance beyond the initial stages of construction.
Mah Sing's core net profit in the first half of financial year 2024 (1HFY24) rose 19 per cent to RM116 million despite a 12 per cent decline in revenue from a higher proportion of new sales secured from new projects.
Meanwhile, the research firm lauded Mah Sing's market-savvy entrepreneurship, demonstrated by its venture into Malaysia's booming data centre industry with Bridge Data Centres Malaysia (Bain Capital) in Southville City, Dengkil, Selangor.
"We like the management's savvy pivot towards data centre (DC)-themed plays with plans to offer up to 500 MW (megawatt) capacity power supply to investors in Southville City and separately leveraging on its substantive Meridin East landbank in Johor Bahru for monetisation plans," it said.
The firm stated that its initial collaboration with Bridge Data Centre for up to 100 MW on 7.0 hectares in Southville City has set the stage for another data centre project of up to 90 MW, which is currently in advanced negotiations.
With a 300 MW power supply at the Meridin East township in Johor, Mah Sing is negotiating with a DC player to sell 17 hectares of land there, a transaction that could generate a disposal gain exceeding RM100 million, equivalent to 42 per cent of the company's FY24 net profit, AmInvest said.
Given the positive mid-to-long-term outlook, AmInvest has maintained its "buy" rating on Mah Sing, with an unchanged fair value (FV) of RM2.11 per share.