SUNWAY: Sunway Secures Second Singapore Land Parcel, TA Securities Downgrades to Hold
| Investment Bank | TA SECURITIES |
|---|---|
| TP (Target Price) | RM5.76 (+9.0%) |
| Last Traded | RM5.29 |
| Recommendation | HOLD |
Sunway Bhd, in a joint venture with Sing Holdings Residential Pte Ltd (35:65 shareholding), has successfully secured its second land parcel at Chuan Grove, Singapore. The 14,514.3 sqm (3.6-acre) site was awarded by the Urban Redevelopment Authority (URA) for SGD623.9 million (approximately RM2.05 billion) with a 99-year lease. This latest acquisition, priced at SGD1,331 per square foot per plot ratio, comes 2.9% above the second-highest bid, underscoring strong developer interest in key sites within the precinct. This marks the JV’s second success at Chuan Grove, following an adjacent parcel secured in July 2025. The latest site is priced 3.3% lower than the earlier plot, attributed to its slightly irregular shape and less favourable location further from the MRT station and main road.
Development Plans and Future Outlook
The newly acquired Chuan Grove parcel is earmarked for a high-rise residential development of approximately 505 units. Development is scheduled to commence on September 10, 2025, with an official launch targeted for the first half of 2027. The project’s Gross Development Value (GDV) has yet to be finalised. According to Sing Holdings’ CEO, the JV intends to amalgamate both Chuan Grove parcels into a single, larger development, subject to regulatory approvals. If approved, the combined project could feature around 1,055 units across five blocks, enhancing design synergies and enabling more extensive shared facilities.
TA Securities estimates the second Chuan Grove’s potential GDV between SGD1.0 billion and SGD1.3 billion. Property consultants project that selling prices for a combined Chuan Grove development could average SGD2,900-3,000 psf at launch. Based on this, TA Securities estimates a potential combined GDV of SGD2.6-2.8 billion (RM9.3-9.6 billion), positioning the JV’s Chuan Grove as one of the largest upcoming residential launches in Serangoon, with strong competitiveness and buyer appeal.
Analyst View and Valuation Adjustment
TA Securities views this latest tender win as a strategic move that further strengthens Sunway’s residential pipeline in Singapore and broadens its partnership base. Despite the positive outlook on the expansion, TA Securities has downgraded its recommendation on Sunway from Buy to Hold. The downgrade comes as Sunway’s share price has risen 7.5% in the past 10 days following the announcement of its proposed healthcare arm listing, narrowing the total return potential to 10.8%.
The target price remains unchanged at RM5.76 per share, based on a Sum-of-Parts (SOP) valuation with a 5% ESG premium. No changes have been made to the FY25-27 earnings forecasts pending further details on the proposed development.
