Yoma

Yoma: UBS maintains Buy with $0.87 TP. The house notes that Yoma reported FY14 headline earnings to S$16.4m (+13.5% YoY). Excluding revaluation gains of S$5.2m on PHGE Lakeview Block G and other non-cash adjustments, core FY14 net profit of $13.9m (+13.4% YoY) was slightly ahead of consensus and UBS estimates. Underlying home sales momentum was positive, with 150 units sold at Star City Zone A & B for ~US$150psf during the quarter. Based on existing pre-sales, unrecognized revenue of S$42.2m will be progressively booked over the coming quarters. Management plans to launch Star City Zone C (940 units) in H214 and think asking prices are likely to be ~US$200psf and targeted at more affluent buyers. The proposed acquisition of Landmark Development is slated to occur by the end of June if the government grants the land lease extension on time. The deal is expected to be RNAV-accretive and will be funded by a 1-for-4 rights issue. Separately, Burmese press releases indicate that Yoma's affiliate company, FMI, was awarded a government contract for a mass-market housing project (~2,700 flats) near Yangon International Airport. According to media reports, Burma's Central Bank is expected to submit a new monetary policy during the next parliamentary session late this month, which could entail plans to gradually allow greater participation from foreign banks. UBS believe modernization of the banking sector is structurally positive and improved access to mortgage loans would likely lift property prices.