Why Analysts Favor S P Setia for Growth

Why Analysts Favor S P Setia for Growth

“S P Setia loved by many analysts for attractive valuation and upside potential”

*Header image is AI generated and is not S P Setia development.

Property developer results reflect the market performance

S P Setia is a very famous brand in the property development industry. It has a huge land bank and if I remember correctly, they are still within the largest few developers when it comes to landbanks here in Malaysia. If we look at just the sales numbers, S P Setia are one of the few developers who could do a billion ringgit of sales every quarter or less. I personally rate any developer who’s selling over RM1 billion per quarter as huge and reflects the property market closely.

We must always keep ourselves updated with the happenings in the property developer side because if they do well, it meant that the property market is performing well. Remember yeah, the sales of properties must happen and then only these numbers will be reported in their quarterly or yearly financial reports. So, if they are reporting a good set of results, they are reflecting the property market too.

The below would be the latest set of results and it seems that the analysts love this company a lot due to a host of reasons. Do read the below:

Article in businesstoday.com: “Analysts are maintaining their positive stance on S P Setia Bhd, citing attractive valuations and potential upside from upcoming projects. MBSB Investment Bank Bhd (MBSB Research), CIMB Investment Bank Bhd (CIMB Securities), and Hong Leong Investment Bank Bhd (HLIB) all retained their BUY ratings, with target prices ranging from RM1.18 to RM1.40.

Analysts highlighted that the property developer’s 9MFY25 earnings and robust new sales position it to achieve full-year targets while its industrial property ventures and planned REIT listing offer further upside.” Do read the full article with all their latest financial highlights too here: Article in businesstoday.com

Diving deeper into the houses they sell?

If we look deeper into a property developer who’s developing a lot of landed properties and they are selling very well but the general numbers show that the high-rise units are not selling well, this tells us that the market demand for landed is very strong but the market demand for the high-rise is not as high. We can also start reading about how many property developers are selling land parcels for data centers…

This tells us that these data centers are paying very good price for the land and thus, selling the land would mean good set of earnings versus the need to develop over many years to earn profits. Anyway, data centers cannot be built on land which does not below to them because that would be crazy. They build the data centre, spend billions and then the owner says, sorry but I want to build something on my land…? Haha.

Do continue reading about more property developers. Know what is driving their set of results would reveal a lot about the property market. Cheers.

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