KUALA LUMPUR: ECM Libra Research maintains its Buy call on Glomac with unchanged target price (TP) of RM1.80  based on P/E of 12x on CY10 earnings which is supported by Glomac’s three-year earnings CAGR of 16.6% with an undemanding implied PEG ratio of just 0.5x.

It is also supported by RNAV of RM2.17 per share, it said in a research note on Wednesday, March 24 there.

Over the next few months, ECM Libra Research said could be several positive news flow. They are the (1) en bloc sale of a 15-storey tower in Glomac Cyberjaya (RM100 million) and Phase 4 of Plaza Kelana Jaya (RM267 million), (2) launching of 378 units serviced apartments in Glomac Damansara which already has 3,000 registrants, and (3) acquisition of a major mixed development landbank in KL with potential GDV of RM4 billion to RM5 billion.

“Glomac reported its best quarter in over two years with 3QFY10 net profit of RM10.6 million. 9MFY10 net profit of RM28.3 million was within expectations as it achieved 71% and 72% of house and consensus full-year estimates respectively,” it said.

Glomac’s three sen net interim dividend as compared to 2.5 sen in 3QFY09 is a pleasant surprise.

“We now expect FY10 net DPS to be at least 6 sen (previously 5 sen). Besides this, we also expect 4QFY10 results to be even better as management has guided that savings from lower CONSTRUCTION [] costs and higher floor space for Glomac Tower will be recognised from 4QFY10 onwards,” it said.