Sime Darby Property gave its update to analyst during a briefing seesion among the key highlights is that the management is cautious on property sales outlook and has set a lower sales target of MYR2.3b for FY23 but it may revise its sales goal by mid-2023 depending on market conditions; land acquisitions in Labu and Klang will be completed by 2023, and landed and industrial properties will remain as the key sales drivers.
The developer is expecting lower sales of MYR2.3b in FY23 (-60% YoY; FY22: MYR3.7b) and intend to focus on project delivery for now in view of rising construction material cost and labour supply constraints that also result in higher costs. Maybank IB says it sees a high chance for the group to exceed its sales goal and our MYR2.5b sales assumption judging from the MYR1.8b bookings as at early Feb 2023 and MYR3b worth of new launches where 56% of these are landed residential (30%) and industrial (26%) properties where demand remains strong especially for the latter. Industrial product, the sales driver Industrial property segment was the second largest sales contributor(MYR907m or 25% of SDPR’s total sales) in FY22, surpassing the high-rise residential segment. Landed residential properties remained as the largest sales driver (42% of sales). Most industrial property launches were >70% sold as at Dec 2022.
Elsewhere, its latest launch in Battersea Power Station namely Koa at Electric Boulevard (204 units of the apartment; GBP1,600psf; launched in Oct 2022) was 39% booked while The Power Station was 90%- leased out as at Dec 2022.
Seperately, the ongoing land acquisitions in Labu (MYR280m; 760 acres) and Kapar (MYR618m; 949 acres) are expected to be completed by this year. Post-the land acquisitions, net gearing will likely increase to 0.31x, from 0.21x i end-Dec 22; still healthy.
