QUOTE(SImPle PLan @ Feb 26 2008, 05:31 AM)
Can anyone tell me wat actually happen to Suncity?
It has post a record profit(due to revaluation of sunway pyramid)
It also planning to list its reit by 2nd half of 2008 but it seems tat tis stock is plummeted down.
Someone said the property market had peaked and now is in the correction phrase. There was a public listed property company that did badly and had to be rescued by IJM. Many fund houses call to underweight the property sector because of expected poor future earnings generally. Sub Prime issue has encouraged people to sell their properties held for speculative purposes.
There was a quite big run up of price to this stock ( Suncity ) last year partly due to "goreng". But the same thing cannot be expected this year with the current sentiment . Stocks are generally on correction phrase.
Sunway group was badly hurt during the currency crisis due to over expansion with very high gearings ( debts ) . And with newly completed second phrase of Sunway Pyramid, the gearing is expected to be high. High gearing is good during the boom, but could be very bad during the bad time. It is like a double edged sword.
The "sudden" expectation of US likely to go into recession have put many business people into fear ( caught unguarded /unprepared), especially for companies with high gearings and poor prospect for property sector.
Turning into Reit could be a safer solution as a good way to reduce the high gearing, probably they might want to avoid the same situation of the Asia Currency Crisis ( if they foresee that there is a likely recession or do not want to take the chance )
Investors at this moment prefer to hold stocks that are defensive in nature. Companies that keep lot of cash have the advantage. Cash could be King . These companies stand a better chance of surviving through a crisis ( if any )
[ High gearing means a company borrows lot of money ( in debts ), compared to the share capital they put in. ( for the beginners of this forumer ).]
Just my 2sen opinion.
Judge you own.
DJ MARKET TALK: Aseam Keeps SunCity At Buy, Target Cut To MYR5.40 - 2008-02-20 07:21:00.0
0721 GMT [Dow Jones] STOCK CALL: Aseambankers keeps Buy call on Sunway City (6289.KU) or SunCity, but cuts target price to MYR5.40 from MYR6.10 based on 13X FY09 EPS estimate; expects possible property sales slowdown post-election "with rising costs of living as the government has hinted at lowering fuel subsidies," says analyst Ong Chee Ting. However, outlook remains good with MYR2 billion targeted sales launches in FY08. Notes FY08 net profit forecast raised by 88.4% and core net profit by 7.7% to reflect higher margin from leisure, hospitality units thanks to Visit Malaysia Year 2007. Adds 2Q08 results were above expectation. Also, SunCity REIT slated for listing in 2H08 will act as longer-term growth catalyst. SunCity shares flat at MYR3.56. (SJO)
This post has been edited by SKY 1809: Feb 26 2008, 11:09 AM 
Feb 25 2008, 08:32 PM
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