Malaysian Property Sector Soars: Top Picks in a Bullish Q1 Market
The $Bursa Property(0020I.MY$ has recently shown a robust uptrend, with a year-to-date surge of 25.80%, significantly outperforming the $FTSE Bursa Malaysia KLCI Index(.KLSE.MY$ Index of 11.18%.
Real Estate Market Transactions Soar in Q1 2024
The Malaysian real estate market witnessed a flurry of activity in the first quarter of 2024, with the volume of transactions exceeding 104,297, marking a 34.3% increase compared to the same period last year.
In terms of transaction volumes,commercial real estate took the lead with the highest jump of 33.4%, closely followed by residential growth at 16.6% and industrial growth at 14.3%. In terms of total transaction value, the residential sub-sector continued to dominate market activities, with transactions exceeding 62,000, accounting for nearly 60% of the overall real estate market activity, and values surpassing 25 billion Malaysian ringgit.
Property Firms Benefit from Special Economic Zone Establishment in Johor
In a recent report, MIDF highlighted that Johor state has proposed the establishment of the Johor Bahru-Singapore Rapid Transit System (RTS), which undoubtedly bodes well for property companies operating in Johor. According to data from PropertyGuru, the property near the RTS station, Princess Cove, has garnered significant interest from homebuyers, becoming one of the most viewed projects on DataSense.
Several property companies possess land holdings in the area. $UEMS(5148.MY$ owns 4,471 acres of land in Gerbang Nusajaya and 1,172 acres in Puteri Harbour; $IOIPG(5249.MY$ holds 3,868 acres in Johor. $MAHSING(8583.MY$, on the other hand, acquires JB land for RM103.75 million, and Sunway has also launched integrated township development projects in the state of Johor.
"We expect steady performance in the property market in 2024. This will help boost our gross domestic product (GDP)," stated government minister Nga Kor Ming. Sunway Real Estate Investment Trust (Sunway-REIT) is also optimistic about 2024, indicating that a more stable domestic political landscape and a commitment to economic reforms will have a positive impact on the long-term economic outlook.
Property Companies Report Strong Financial Performance in the Q1 FY2024
Investors are closely monitoring the investment opportunities behind the standout performance in the real estate sector. Among the property companies that have reported earnings, S P Setia has shown strong performance, with its net profit for 2024 increasing by 39.4% YOY to RM77.3 million, soaring to near a six-year high. MGB has also delivered a notable performance, with its net profit up by 18.20% YOY.
$SPSETIA(8664.MY$: S P Setia is confident in its projections for continued upward momentum in 2024, supported by new projects launched in Q1 and a favourable market uptake. The property group's Q1 2024 net profit jumped 39.4% YoY to MYR77.3m, as revenue soared 52.5% to MYR1.48bn. S P Setia said its property development segment achieved a 57.1% YoY increase in revenue to MYR1.41bn, primarily due to the higher contribution from Vietnam with the handover of its Eco Xuan project in Ho Chi Minh City, and higher domestic property development turnover. The company also revealed revenue from other operations had mainly consisted of manufacturing and investment properties such as office towers, retail malls, convention centres and hotels.
$MGB(7595.MY$: Construction and property development solutions provider MGB Berhad reported revenue of MYR217.88m ($51.98m) for Q1 2024, an increase of 22.57% YoY. The property development segment's revenue increased nine-fold to MYR87.59m, predominantly from higher sales and progress in development. The construction and trading segment accounted for 59.8% of Q1 2024 revenue, while the property development segment accounted for the remaining 40.2%. The near-completion of projects and cost-saving measures undertaken by the group spurred earnings growth. MGB's construction order book remained healthy at MYR1.19bn and its property development unbilled sales totalled MYR740m as at 30 April.
Below is a list of Malaysian property sector stocks with a market cap exceeding RM 1 billion. With more and more Malaysia companies releasing earning results in Q1 2024, which of these property stocks do you favor the most? Mooers, please share your insights~
Source: moomoo, the Edge Malaysia, the Malaysia reserve
Disclaimer: Moomoo Technologies Inc. is providing this content for information and educational use only.
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