Maybank IB said it is positive on EcoWorld's latest MOU with SD Guthrie (SDG MK, BUY, CP MYR4.92, TP MYR5.41) and NS Corporation (state government representative) to develop a 1,166-acre industrial park in Negeri Sembilan.
The collaboration it added is a win-win, with ECW leveraging SDG's sizeble landbank and SDG benefiting from ECW's strong track record and branding. The house said it maintains earnings forecasts and MYR2.25 TP (1.3x FY25E P/B) pending further details. Reiterate BUY.
Developing 1,166 acres land in Negeri Sembilan
ECW, SDG and NS Corporation have announced plans to jointly develop a 1,166-acre industrial park in Bukit Pelandok, Negeri Sembilan. The park, located within the Malaysian Vision Valley 2.0 (MVV2.0) and near Kuala Lumpur International Airport (KLIA), will feature industrial lots, readybuilt factories and commercial properties, targeting high-growth sectors including the aerospace, electrical and electronics, logistics and biotechnology industries. Total GDV is estimated at MYR2.9b, with
development spanning over eight years.
A win-win deal
The house views the latest MOU positively as this strategic partnership it said leverages the unique strengths of both ECW and SDG, driving mutual growth and long-term value creation. As one of the largest landowners in Malaysia, SDG brings valuable 'hardware' in the form of extensive landbank, while ECW, as a leading property developer in the country with a strong brand presence and proven track record, plays a crucial role in unlocking the full potential of this landbank. Beyond development, ECW's strong branding is expected to enhance the value of the property, making it more marketable and appealing to potential business owners and investors, we believe.
A good start for future collaboration
Maybank maintains its earnings forecasts pending further details such as JV structure. In our view, the partnership will not only help to replenish ECW's depleting landbank and expand its presence in the industrial property segment in new state – Negeri Sembilan but more importantly, it may pave the way for future collaboration opportunities with SDG.
