UEM Sunrise Berhad via its wholly-owned subsidiary, Sunrise Alliance Sdn Bhd signed a sale and purchase agreement with Kemaris Residences Sdn Bhd to acquire a 19.24-acre plot of land for RM109.5m in Taman Equine, Seri Kembangan, Selangor. We understand that the development order has been approved for Equine Land comprising 924 residential units with estimated GDV in excess of RM700m. The price paid for the land appears to be reasonable at c.17% of the potential GDV. We are positive on the move to increase its landbank in the Central region. Funding should not be a problem as its recent asset divestments totaling c.RM778m gives it ample firepower. Maintain Outperform with TP kept unchanged at RM1.50, pegged to c.50% discount to RNAV.

• Proposed development for the new land. We understand that the new land is earmarked for 924 residential units targeted for upper-mid market purchasers. The said development is located at Taman Equine which is approximately 18km to the south of Kuala Lumpur city centre, and is easily accessible via Maju Expressway (“MEX”), Lebuhraya Damansara Puchong (“LDP”), and South Klang Valley Expressway (“SKVE”). The Equine Park MRT2 Station which is currently under construction is located 1.3km to the south of Equine Land. Also, AEON Taman Equine, Alice Smith International School, and two hypermarkets are located within a 3km radius. We believe UEMS should have no problem selling especially for its central region projects. Case in point is Solaris Parq (which was just launched recently), its latest launch in Dutamas garnering more than 80% sales so far.

Source: PublicInvest Research - 13 Dec 2017