In line with the ELKDESA’s strategic direction to grow its hire purchase portfolio amidst economic recovery environment, the group increased its hire purchase receivables 19.4% YoY and 7.5% QoQ to RM560.3m. Liabilities wise, the group’s bank borrowings increased by 51.9% YoY to RM198.6m as a result of higher drawdown of block discounting facilities to support the increased hire purchase receivables.

Blended ASP declined -8.3% QoQ in 3QFY23. Given the intense market competition, we reckon that ASP may remain under pressure, before mild signs of revival towards mid-to-end 2023 as purchasers’ inventory levels from previous stockpiling activities dialed down and exit of new entrants from recent years.

Local building contractor specialising in design & build method and incorporates a digital management application which improves business operation efficiency. VLB is valued by pegging its FY23f core EPS of 3.6 sen to PE of 12.0x, leading to a FV of RM0.43.

Moving forward, we are cautiously optimistic on the office space outlook over the near term as we expect the market sentiment to remain soft amid rising inflationary pressures on the global economy. Besides, we expect an increase in property operating expenses due to electricity tariff hike effective 1st January 2023 to 30th June 2023.

Operating 12 furnaces. Following the aforementioned conversion, we gather that OMH continues to operate 12 out of 16 furnaces. Coming into FY23f, we reckon that OMH will be able to deliver a total production of 360,000 tonnes/pa. Already, 9M22 saw total production of 281,341 tonnes (106,023 FeSi and 175,318 Mn) which accounts to 78.2% of our assumption of 360,000 tonnes.

Thailand-based consumer packaged foods distributor who serves as an exclusive distributor for ChaCha brand products for Thailand market, distributing to 43 distribution points covering Central, Northeast, Northern, and Southern regions. We project core earnings to grow from (i) improved demand amid economic recovery, (ii) reduced purchase price from suppliers resulted from lower raw material, packaging and energy cost, as well as (iii) product range expansion. Wellspire is valued by pegging its FY23f EPS of 1.8 sen to 15x PE, leading to a FV of RM0.27.

We expect the contract will be able to produce a high single-digit EBITDA margins, which is in line with similar works performed by the group historically. With KGB starting off the year on a high gear, we expect further contracts to come by for the remainder of FY23f.

Established in 2006, Hektar has now expanded its property portfolio to 6 shopping centres spanned across Subang Jaya, Melaka, Muar, Sungai Petani, Kulim, and Segamat worth a total of RM1.20 bn. We project core earnings to be driven by improving occupancy rate amid economic recovery in FY24f, as well as the REIT’s initiatives to improve energy efficiency. Hektar is valued by pegging its FY23f core EPS of 7.7 sen to P/E of 11.0x, leading to a FV of RM0.84. Projected dividend yield is attractive at 9.9% for FY23f based on current share price.