Kenanga Research favours the property developer for its strong net cash position of RM233.7mil as of Dec 31, 2024.
PETALING JAYA: Kenanga Research continues to like UOA Development Bhd
for its strategy of focusing on mid-priced developments and its land holdings in highly sought-after locations.
The research house said construction for the mid-range residential projects Aster Hill and Laurel Residences in Kuala Lumpur, was on track, with completion scheduled for 2026.
Meanwhile, the Bamboo Hills Residences project, also in Kuala Lumpur, that was launched last July with a projected gross development value (GDV) of RM1.4bil, has already achieved a 65% take-up rate as of last December and is expected to be completed by 2029.
Kenanga Research also favoured the property developer for its strong net cash position of RM233.7mil as of Dec 31, 2024.
“While earnings visibility remains somewhat limited, with unbilled sales at RM837.4mil, it is backed by stable rental income and rising occupancy in its office and retail spaces such as Bamboo Hills and Sphere.
“Additionally, its hospitality segment, including the Komune Living and Wellness integrated co-living and wellness hub in Kuala Lumpur, is expected to benefit from both domestic and international guests,” it added.
The research house said UOA’s core net profit of RM240.2mil for last year came in at 109% and 100% of its full-year forecast and the full-year consensus estimate, respectively.
It pointed out that the performance was due to better-than expected property sales at its Bamboo Hills Residences, while Aster Hill and Laurel Residence saw better revenue recognition.
Revenue last year increased by 37% year-on-year due to better property sales from Bamboo Hills Residences, while Aster Hill contributed strongly due to its encouraging progress completion.
The developer’s core net profit rose by 11%, driven by better rental incomes and hospitality profits.
The research house raised its earnings forecast for UOA this year by 13%, incorporating higher revenue recognition attributed to better progress on projects. It maintained its “market perform” call as UOA’s share price has risen 2.8% year-to-date.
The counter closed marginally higher at RM1.77 yesterday, giving UOA a market capitalisation of RM4.65bil.
