KUALA LUMPUR, Sept 8 (Bernama) -- Bursa Malaysia closed almost flat on Tuesday as buying interest rotated away from index heavyweights towards smaller-cap construction stocks, with sentiment affected by geopolitical uncertainty, said an analyst. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) eased 0.39 of a point to 1,714.40 from Monday’s close of 1,714.79. The benchmark index opened 1.65 points lower at 1,713.14 and moved between 1,710.44 and 1,714.50 throughout the trading session. The broader market was almost evenly balanced, with decliners leading gainers 548 to 546, while 598 counters were unchanged, 1,107 were untraded and 25 were suspended. Turnover expanded to 4.13 billion units valued at RM3.14 billion from 3.60 billion units valued at RM2.45 billion on Monday.
Eco World Development Group Bhd (KL) saw its shares rise to their highest level in seven weeks on Friday, following the release of better-than-expected third-quarter results. The stock climbed three sen (1.7%) to RM1.77, its highest since August 1, 2024. As of 9:06 am, the stock traded at RM1.76, giving the company a market capitalization of RM5.19 billion, with a trading volume of 594,400 shares.
For the nine months ending July 31, 2024, EcoWorld's core net profit accounted for 82% of consensus full-year estimates. Additionally, the company has surpassed its own full-year sales target, leading analysts to increase their earnings forecasts.
UOB Kay Hian raised its net profit forecast by up to 12% for FY2024-FY2026, predicting that sales will reach RM3.8 billion by the financial year-end in October 2024. The research house also boosted its target price for EcoWorld to RM2.10, maintaining a 'buy' call, citing the company’s improving balance sheet, return on equity, and attractive dividend yields of 4%-5%.
EcoWorld shares have gained nearly 70% this year, reflecting strong performance in the broader property sector and positive developments related to data center and industrial properties.
Out of nine research houses, six maintain 'buy' calls on the stock, two recommend 'hold', and one advises 'sell'. The consensus 12-month target price stands at RM1.88, implying a potential 7% return from the last price, according to Bloomberg.
EcoWorld is expected to achieve RM289 million net income for FY2024, according to seven analysts on Bloomberg. CGS International also maintained its 'add' call, noting the company's robust earnings outlook, potential land bank monetization, and attractive dividend yields of 3.5%-3.7% for FY2024-FY2026.
The company has already hit its full-year sales target of RM3.5 billion within the first 10 months of FY2024 but has opted not to raise the target for the remainder of the year. EcoWorld’s cumulative net profit rose 18.32% to RM220.12 million, while revenue grew 17.17% to RM1.62 billion for the same nine-month period.
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