Sunsuria Berhad‘s (Sunsuria) 1QFY23 results came in weaker than expected primarily due to deferment of certain launches in Sunsuria City township given the challenging trading environment. Group inventories, we understand, are also almost sold out meanwhile. Sunsuria’s 1QFY23 net profit of RM1.3m (-86.1% YoY, -66.4% QoQ) only constituted c.5% of our full year estimates. Pre-sales in 1QFY23 amounted to RM88.8m, mainly driven by Bangsar Hill Park, Sunsuria Forum at Setia Alam and Tangerine Suites at Sunsuria City township. Unbilled sales as at 1QFY23 stood at RM957m. All told, we adjust FY23/24 downwards by 31%/26% after we change our billings and sales assumptions. Maintain Neutral and RM0.40 TP, based on a 0.4x to price-to-book ratio (PBR), which is pegged at sector average.
- 1QFY23 revenue dropped 25.4% YoY, due to deferment of certain projects mainly in Sunsuria City due to challenging trading environment. Furthermore, the Group’s inventories are almost fully sold. Sunsuria Forum (Phase 2) contributed 45.9% of Group 1QFY23 revenue while Sunsuria City township projects contributed 28.8%, 23.6% came from Bangsar Hill Park (Block A, D and E) and the remaining 1.7% is from other business segments. Group PBT dropped 64% YoY to RM4.5m mainly due to lower revenue, higher sales and marketing expenses, and higher salary cost due to Group-wide salary adjustments to cope with inflation.
- Remaining total GDV of RM9bn. Sunsuria currently has c.396 acres of undeveloped landbank with potential GDV of RM9bn 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. In 1QFY23, the Group sold RM88.8m mainly from its on going residential development project Bangsar Hill Park project, the integrated residential and commercial development Sunsuria Forum (Phase 2) at Setia Alam, and the multi-facility serviced apartment Tangerine Suites located at the Sunsuria City township.
Source: PublicInvest Research - 28 Feb 2023