Friday 8 June 2012

Asas Dunia Berhad deeply undervalued?

Main board listed property company, Asas Dunia Berhad (5975), holds significant land bank in Seberang Prai. Land held for development approximately 1125.2 acres.

I believe the lands are appreciating and will appreciate further in view of the good prospect after the opening of the Second Penang Bridge scheduled to complete by September 2013.

Checks on website revealed that the asking price for the land there was about RM25/sq ft. The lands held by ASAS are currently carrying average book value of only RM4.37/sq ft!

Revaluation of the land at RM15/sq ft will bring a total surplus of RM521 million, or translate into RM2.72 per share.

Current share price RM1.30. Approximate RNAV per share RM4.73.

Value the share at 0.5x book value, the stock has upside of about 82% (from RM1.30 to RM2.37).

Note that the stock is tightly held and currently not covered by any research house.


  1. Asas Dunia to focus on light industry

    19 June 2012

    GEORGE TOWN: Property developer Asas Dunia Bhd is looking to tap into the demand for light industrial parks on mainland Penang by building one in Nibong Tebal next year.

    Its managing director Datuk Jerry Chan Fook Sing said yesterday Asas Dunia had earmarked 40ha of land in Jawi to build detached and semi-detached light industry factory units.

    "As the state authorities look to expand industrial land at both the Penang Science Park and Bukit Minyak Industrial Estate to accommodate demand from investors, we see an opportunity to provide industrial space for the supporting industries," he said after the company's annual shareholders' meeting here.

    Among the foreign investors who have established a presence at the Bukit Minyak Science Park are Ibiden Co Ltd and Singapore Aerospace Manufacturing's Aviatron (M) Sdn Bhd.

    Seeing that there has been a take-up rate of 80 per cent in the past year-and-a-half for its light industrial buildings in Permatang Tinggi, Chan is confident that there will be sizeable demand for such buildings in the near future.

    "Instead of selling the light industrial buildings, we may consider leasing out these units in the future."

    For the 2011 financial year, Asas Dunia saw a 53.86 per cent increase in revenue to RM112.04 million, up from RM72.82 million in 2010.

  2. Asas Dunia to launch properties worth RM300mil in Seberang Prai

    19 June 2012

    GEORGE TOWN: Asas Dunia Bhd is launching 1,356 units of landed properties worth approximately RM300mil in gross development value in Seberang Prai from now until the end of 2013, due to the growing interest to invest in properties in Seberang Prai.

    The properties comprise largely single- and double-storey properties, priced between RM200,000 to RM600,000.

    “We are launching more properties because on top of the trend to buy properties to stay in Seberang Prai, we are also seeing more people buying properties on the mainland for investment.

    “They are gradually realising the investment potential of properties in Seberang Prai, as the second bridge is scheduled to be completed soon, and more investments are coming into the industrial park of south Seberang Prai.

    “The state government will probably need to expand the Penang Science Park in Bukit Minyak and the industrial estate in Batu Kawan, as there are more small and medium enterprises from Singapore coming into the country,” group managing director Datuk Jerry Chan said after the company's AGM.

    As a result of the demand for properties in Seberang Prai, the price for a double-storey semi-detached house in Bukit Mertajam, for example, has increased to RM1mil from about RM500,000 three years ago.

    The price of a double-storey terraced house in Bukit Mertajam town is now about RM450,000, approximately 70% higher than the price three years ago.

    “But the RM1mil price for a semi-detached house in Bukit Mertajam is still more attractive than that of a semi-detached property on the island, which is priced between RM2.5mil to RM3.5mil.

    “The price of a vacant land per sq ft is between RM20 to RM50 per sq ft, double of what it was two years ago, depending on the location,” he said. For the first quarter ended March 31 2012, the group posted pre-tax profit of RM12mil on the back of RM36.4mil revenue, compared with RM8.6mil and RM29.8mil achieved in the corresponding period the previous year.