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Thursday, February 6, 2014

MKH rallies, fuelled by talk of listing plantations


At 3.13pm, MKH was up 24 sen to RM3.24. Turnover was 1.19 million shares done. Its warrants, MKH-WB rose 18 sen to RM1.69. There were 1.44 million units traded.
The FBM KLCI rose 5.02 points to 1,783.85. Turnover was 916.04 million shares valued at RM884.30mil. There were 370 gainers, 258 losers and 290 counters unchanged.
Hwang DBS Vickers Research (HDBSVR) said its recent meeting with the management reinforced its conviction that MKH was on the horizon of a multiyear rerating.
"Contrary to market expectation of a slowing property market, MKH's affordable housing projects continue to gain traction among its buyers which are typically genuine homebuyers/upgraders.
"Its RM890mil launch pipeline for FY14 includes the impact of recent cooling measures by the federal government, and is expected to further boost its record high unbilled sales of RM503mil (as at September 2013)," it said.
HDBSVR also said coming from a low base, MKH's plantation profits will be growing at an astounding 69% CAGR over FY13-16F. Nevertheless, MKH is still seeking more plantation land in Indonesia.
"In the longer term, MKH may float its plantation operation to unlock value for shareholders. MKH's current valuation implies its plantation business (more than RM1bil market value) is accorded zero value, which is unjustified," it said.

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