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Wednesday, August 20, 2014

Mah Sing Group - It only gets better with Lakeville Residence

Source: http://klse.i3investor.com/blogs/amresearch/58109.jsp

- We maintain our BUY call on Mah Sing Group with an unchanged fair value of RM3.60/share – at parity to its NAV. Mah Sing officially launched its Lakeville Residence project at Taman Wahyu, KL last weekend, where more than 9,000 guests turned up for the event.

- Not unlike the initial take-ups for its other recent key projects in the Klang Valley (e.g. Southville City@Bangi, D’sara Sentral), the response to Lakeville Residence has been encouraging.

- Lakeville Residence has a total GDV of c.RM1.5bil that comprises six towers (A, B, C, D, E & F) of residential and commercial products designed with a lakeside living theme.

- During its official launch, the first four blocks (total: 1,244 units) saw a take-up rate of 85% with an indicative value of c.RM708mil. Two more towers (C & D) were opened for registration of interest.

- The serviced apartments have built-ups that range from 978sf to 1,365sf, with prices starting from ~RM562k. In addition, there are also limited units of three to four storey lifestyle shops (built-up: starting from 4,651sf at RM3.5mil onwards) that fronts Jln Sibu.

- From our channel checks, the average pricing for the condo blocks have already moved up from c.RM550psf initially to about RM580psf-RM600psf.

- In our view, the vibrant debut of Lakeville Residence could be largely due to its well-thought-out concept, attractive price point, and strategic location. Firstly, the development is located along Jln. Kuching and within the matured neighbourhoods of Kepong and Selayang (15 minutes from KL city centre). Connectivity will be further boosted via a proposed link road to Tesco and Kepong.

- From a product stand-point, purchasers of Lakeville Residence will enjoy partially furnished units that will come with fully-fitted kitchen cabinets, air conditioning, water heaters and two parking slots.

- Another key attraction is a 3-acre nature-themed facility podium within the development, which will be one of the largest sky parks in KL when completed. All this comes with the lakeside location of Taman Wahyu, with excellent frontage skirting the lakeshore.

- We continue to rate Mah Sing as our top large cap property pick. The stock trades at a steep discount of 32% vis-a-vis its NAV despite its strong project pipeline and healthy unbilled landbank GDV of c.RM40bil (including unbilled sales of c.RM4.6bil).

Source: AmeSecurities

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