KUALA LUMPUR, July 30 (Bernama) -- Bursa Malaysia's key index closed at an intraday high today, supported by continued buying interest even as renewed geopolitical tensions and a weaker overnight lead from Wall Street following the US Federal Reserve's (Fed) decision to stand pat on interest rates weighed on broader sentiment. The Fed has decided to hold rates steady for the fifth consecutive meeting, with the Federal Funds Rate unchanged between 3.50 per cent and 3.75 per cent. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) rose 4.84 points to 1,720.40 from yesterday’s close of 1,715.56. The benchmark index, which opened 1.14 points lower at 1,714.42, hit its lowest level of 1,710.69 in early trade before gaining momentum for the rest of the day. However, the broader market was negative with losers outpacing gainers 581 to 411, while 612 counters were unchanged, 1,173 untraded, and 87 suspended. Turnover declined to 2.49 billion units valued at RM2.25 billion from ...
In the second quarter of 2024, Malaysian property developers reported mixed financial results, largely influenced by significant one-off factors such as notable land sales. The sector is now awaiting further details on the Johor-Singapore Special Economic Zone (JS-SEZ), whose announcement has been postponed to November 2024, reverting to its original timeline from the previously planned September 2024. In the absence of new thematic drivers, attention has turned to companies with strong fundamentals and a proven track record.
Analysts are advising investors to focus on developers with a solid history of execution and those capable of unlocking land value or synergies through strategic land sales and corporate exercises. Notable BUY recommendations in this context include ECW, SPSB, and SWB.
Performance Highlights of Listed Developers
Among developers with a fiscal year ending in December, 71% have reported their second-quarter results:
- SWB and TILB: Net profits aligned with expectations.
- SDPR: Exceeded forecasts.
- SPSB and UEMS: Fell short of expectations.
- SPSB faced unexpected losses from its BPS project.
- UEMS struggled with low take-up rates for several high-rise projects in the Klang Valley and a lack of land or asset sales.
Despite these setbacks, property sales for most developers—including SDPR, TILB, UEMS, and SWB—are on track to meet their annual sales forecasts, with the exception of SPSB.
Key Drivers for Property Stocks
Corporate exercises and thematic drivers such as the JS-SEZ, data center investments, and the KL-Singapore High-Speed Rail (HSR) project continue to attract interest in property stocks. However, analysts advise investors to be selective, focusing on companies with strong fundamentals and a clear pipeline of projects or ongoing corporate exercises.
While the JS-SEZ could potentially benefit property developers, its expanded coverage might dilute the positive impact, making it crucial for developers to have strong track records and capable management teams to maintain competitiveness in the evolving market landscape.
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