Sunsuria Berhad’s (Sunsuria) 4QFY23 net profit came in below expectations at RM1.2m (-41.6% YoY, -82.2 QoQ). Group FY23 net profit of RM13.9m (-16.1% YoY) only constituted about 64% of our full year estimates as revenue for the year was driven more by its JV projects than what we expected. We keep our earnings estimates for now pending more clarification from management, though we caution for potential cuts ahead. As at 4QFY23, Group unbilled sales stood at RM926.8m, decreasing slightly from RM983.3m in 3QFY23. So far, the Group has launched two new projects i.e. Seni Residences at Sunsuria City and Sunsuria Kejora Business Park (Phase 1), a semi-detached industrial development in Puncak Alam. We understand that it is looking to unveil Talisa, the second phase of its Bangsar Hill Park development by the end of the year. All told, we maintain our Neutral call and RM0.40 TP, based on a 0.4x to price-to-book ratio (PBR), which is pegged at sector average.

• FY23 revenue rose 26.1% YoY to RM507.2m, primarily driven by the integrated mixed development of Sunsuria Forum in Setia Alam, residential development of Bangsar Hill Park, and Sunsuria City township projects. During the year, the Group made notable progress in the construction works for its ongoing projects of Bangsar Hill Park project and Sunsuria Forum (Phase 2) in Setia Alam and successfully launched two new projects in FY2023, namely Seni Residences at Sunsuria City and Sunsuria Kejora (Phase 1), a semi-detached industrial development in Puncak Alam. Elsewhere, Sunsuria also recognised revenue from the sale of completed inventories, including Sunsuria Forum (Phase 1) in Setia Alam and Giverny Walk at Sunsuria City.

• Remaining total GDV of RM8bn. Sunsuria currently has c.2052 acres of undeveloped landbank with potential gross development value (GDV) of RM8bn which we estimate could take at least 8-10 years to develop. About RM6bn GDV is mainly from Sunsuria City @ Salak Tinggi which has already completed projects with combined GDV of RM1.4bn to-date. On-going residential development projects, among others, include Tower A, D and E of Bangsar Hill Park, Seni Residences and multi-facility serviced apartment Tangerine Suites at Sunsuria City township and integrated mixed development Forum 2 at Setia Alam. We understand that its subsidiary, Bangsar Hill Park Development Sdn Bhd will unveil Talisa, the second phase of its Bangsar Hill Park development by end of the year. The company held an official preview of the project back in July and we understand that it has received more than 2,000 registrations. Talisa has a GDV of RM1.1bn and comprises 802 units across two blocks (Blocks B and C). Block B is a 57-storey tower with 410 units while Block C is a 55-storey tower with 392 units.

Source: PublicInvest Research - 27 Nov 2023