KUALA LUMPUR: AmInvestment Bank Research has raised its earnings assumptions on Sunway Bhd due to higher progress billing assumptions following an increase in the group's FY21 sales target.

       Sunway announced yesterday that the sales target for the current financial year was raised 38% to RM2.2bil as the earlier target of RM1.6bil had already been in hit in the first half of the year.

       In view of this, AmInvestment raised its FY22-23 earnings projections on the group by 5%, while maintaining its "buy" call with an unchanged sum-of-parts-derived fair value of RM2.20 a share.

       The strong performance was underpinned by encouraging sales in excess of RM1bil in Singapore in 1H 20201, particularly the high-rise condominiums, Ki Residences in Clementi and Parc Central in Tampines, which achieved take-up rates of 55% and 80% respectively.

       On the local front, the two towers of Sunway Belfield, located in KL city centre, were also well received with a take-up rate of 75% although the development was just launched in January and an earlier-than-scheduled second tower launch.

       The projects generated sales worth RM164mil in 1QFY21, attaining 59% of local sales.

       "We are encouraged by the strong buying support for Sunway’s property launches against the backdrop of an uncertain sector outlook given that longer movement restrictions could lead to closures of sales galleries and stop-work order on construction sites in EMCO districts which could result in lower-than-expected 2H sales," said AmInvestment.