“We view this as a timely opportunity to expand MRCB’s commercial exposure in a prime and strategic location," said HLIB Research.
PETALING JAYA: The redevelopment of the KL Sentral Station on a private-finance-initiative basis with Malaysian Resources Corp Bhd (MRCB) at a cost of more than RM1bil is a well-timed chance to enhance the company’s commercial presence in a prime and strategic area, according to Hong Leong Investment Bank (HLIB) Research.
“We view this as a timely opportunity to expand MRCB’s commercial exposure in a prime and strategic location. From what we gather, demand has been strong historically, with residential developments seeing take-up rates of 85% and above,” the research house said.
HLIB Research said back-of-the-envelope calculations suggested that post-disposal of Menara CelcomDigi, this project (RM1bil) in isolation could increase net gearing from 0.27 times to a still manageable 0.49 times
“Nevertheless, if MRCB undertakes this project concurrently with the Shah Alam Stadium redevelopment (over RM1bil), this could take net gearing beyond 0.49 times, by our estimates,” the research house said in a note to clients yesterday.
According to Transport Minister Anthony Loke, the Cabinet has agreed in principle on the redevelopment of the transportation hub.
HLIB Research has maintained a “hold” call on MRCB with an unchanged sum of part-driven target price of 34 sen.
