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Wednesday, February 20, 2008

YTL Land target price revised downward

GOOD LOCATION: One of YTL Land's projects in Sentul

DBS VICKERS Research has cut its target price on shares of YTL Land Bhd by 18 per cent, citing a delay in project launch.

The research house has revised its target price to RM2.70 from RM3.30 previously.

"Project launches at Pantai Peak are likely to be postponed to second half 2008 due to slower-than-expected approval from the authorities.

"We understand that the relocation of the current access to the development is slowing the speed of the approval," DBS Vickers said in a report yesterday.

However, it believes that a new traffic plan has been submitted and the project would be launched this year.

"We adjust our earnings estimates due to the timing differences of the project launches. We have revised our FY2008 and FY2009 net profit to RM31 million (from RM55 million) and RM88 million (from RM148 million)," said DBS Vickers.

The Pantai Peak project is expected to have a gross development value of RM800 million.

DBS Vickers also thinks that YTL's Sentul and Pantai Peak projects would take a longer time to be developed.

"However, we believe YTL Land's good location, accessibility and product differentiation should transform Sentul into a sought after address in Kuala Lumpur.

"The strong take-up and price appreciation in Mont' Kiara/Dutamas and KLCC area are strong indicators that there is demand for quality luxury condominiums," it said.

By New Straits Times

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