MATRIX CONCEPTS HOLDINGS BHD
By Kenanga Research
Outperform (maintained)
Target price: RM3.05
MATRIX is targeting at least RM1.1bil in gross development value (GDV) worth of property projects for 2015, with its commercial and residential projects making up 15% and 85% respectively, according to Kenanga Research.
It said the projects were located in Bandar Sri Sendayan (GDV: RM670mil), Taman Seri Impian (GDV: RM206mil) and Residency SIGC (GDV: RM229mil). These launches exclude Sendayan Tech Valley land sales and also its KL high-rise project (GDV: around RM400mil).
The research house added that management had set up a conservative sales target of RM700mil for financial year 2015 (FY15), of which RM600mil would be from commercial and residential property sales, and RM100mil from industrial land sales, in line with its FY15 sales estimate of RM697mil.
It believed the sales target was achievable despite a slower property market as “affordable” landed residential priced below RM500,000 made up 58% of its RM1.1bil planned launches.
Kenanga Research said Matrix had also indicated that it was still actively looking for landbank replenishments, especially for industrial land banks close to Sendayan Tech Valley.
However, it said management expected landbanking news flow to be slow in FY15 as prospective land banks were hard to come by due to pricing issues.
Nonetheless, it said it was confident that Matrix would still be able to replenish land bank in FY15 given its light balance sheet, which was still in a net cash position.
Maintaining its “outperform” call, the research house said it continued to like Matrix for its affordable/mass market exposure, which tended to target genuine buyers, coupled with industrial developments capitalising on the Greater Klang Valley story.
TENAGA NASIONAL BHD (TNB)
By AllianceDBS Research
Buy
Target price: RM16
TNB remained a top pick for the sector given its strong earnings clarity with the implementation of the Imbalance Cost Pass Through (ICPT) mechanism as well as robust outlook for electricity demand, said AllianceDBS Research.
It said that management had indicated that the earlier assumed generation mix was 38.2% coal and 55.9% gas but had turned out to be 46.3% coal and 49.2% gas as a result of higher availability of coal power plants.
“The impact of the favourable fuel mix change is two-pronged with higher-than-expected savings arising from lower liquified natural gas (LNG) usage, and capacity payment in the second half of 2014 as it was initially estimated to be skewed towards gas-based generation,” it added.
