Tropicana plans RM1.72 bil new launches this year

KUALA LUMPUR (Feb 25): Tropicana Corp Bhd plans to launch RM1.72 billion worth of properties and is targeting to achieve RM1.5 billion of property sales in 2016, according to Affin Hwang Capital Research.

“The bulk of the planned launches will be in the central region (43%), followed by the northern region (39%),” Affin Hwang Capital wrote in a note on Monday.

The research firm said Tropicana achieved property sales of RM33 million in the fourth quarter ended Dec 31, 2015 (4QFY15), bringing its full-year total property sales to RM1.55 billion, which were in line with its 2015 sales target.

“As at Dec 31, 2015, Tropicana’s unbilled sales reached a new high at RM3.1 billion, underpinned by sales launches in 2015, as well as ongoing projects, namely in the central (65%) and northern (25%) regions.

“We continue to like Tropicana for its strategic landbank, undemanding valuation and its ongoing asset monetisation exercise,” it said, adding that Tropicana’s net gearing has also improved to 0.33 times as at Dec 31, 2015, from 0.68 times as at Dec 31, 2014.

Tropicana posted a net profit of RM29.08 million on revenue of RM304.88 million in 4QFY15.

AffinHwang has a buy call on Tropicana, with an unchanged target price of RM1.95.

This article first appeared in The Edge Financial Daily, on Feb 25, 2016. Subscribe to The Edge Financial Daily here.