“Malaysia’s property developers forecast strong 3Q24 earnings, driven by robust sales, key launches, and growth in Johor projects. Learn more.“
Kuala Lumpur, 12th Nov 2024, 10.30am – Property developers are anticipated to report strong earnings in the third quarter of 2024 (3Q24), buoyed by robust sales and strategic project launches during the period.
RHB Investment Bank analyst Loong Kok Wen highlighted that the second half of the year (2H24) is traditionally a stronger period for real estate companies, as most ramp up their project launches. “Generally, in 3Q, we will see stronger numbers compared with 2Q,” Loong told, noting that Sime Darby Property Bhd (SimeProp) and S P Setia Bhd have shown consistent launches throughout 2024.
Veteran investor Ian Yoong pointed out that while Budget 2025 had limited immediate impact on the property sector, 1H24 sales figures remained strong. “Residential property transactions grew by 6.1% in 1H24, and the transaction value rose by 10.4%,” he said. The overall property transaction value for 1H24 was RM105.65 billion, marking a 23.8% increase year-on-year and indicating a positive shift in the residential property market after years of subdued demand.
Yoong also emphasized the importance of branding, with projects like SimeProp’s Elmina township and Business Park (EBP) serving as prime examples. He highlighted that Google’s upcoming US$2 billion data center within EBP, projected to generate 27,000 jobs, positions this project as a significant driver of revenue for SimeProp over the next decade.
A report from UOB Kay Hian (UOBKH) Research echoed similar sentiments, forecasting strong year-on-year growth in net profit for many developers, driven by strategic land sales. UEM Sunrise Bhd and S P Setia are expected to post over 100% net profit growth, while Sunway Bhd is projected to achieve 60% growth due to contributions from its Parc Central project in Singapore. Mah Sing Group Bhd and Lagenda Properties Bhd are also expected to see 20% to 30% growth.
Developers with Johor-based projects, like UEM Sunrise and Sunway, are anticipated to post robust 3Q24 earnings, as take-ups for recent launches in Johor have been high. “Landed properties in southern Malaysia continue to attract buyers,” Loong added.
CIMB Securities also emphasized the rising demand for strategically located projects in Iskandar Puteri, Johor, where improvements in connectivity and industrial property demand are enhancing sales for Sunway and UEM Sunrise. The area’s development includes Sunway City Iskandar Puteri, Sunway’s largest township, and UEM Sunrise’s Puteri Harbour, a prime waterfront community with an international ferry terminal.
As the sector trends upward, developers with strong branding, diversified projects, and strategically positioned properties are poised to capitalize on Malaysia’s revitalized real estate market.
