Filed under: Real Estate | Tags: gugusan dedap, gugusan semarak, kota damansara, salvia apartment, tainia apartment
Lately i post more messages concerning real estate than stocks
properties in kota damansara will go up because
1) Giant hypermart – i think will be ready by late 2008 or early 2009
2) Carrefoure hypermart – late 2009
3) 2 medical center – early or late 2009
4) Jusco in Giza – early 2009
5) LRT connect to 1 U and sg. buloh – this one not sure just rumors. i dunno whether govt has the money or not.
years of completions are only based on my observations at the construction sites not from professional views.
i think it is a good opportunity to purchase apparments to be rented out to the target customers who are working in those hypermart and medical centre.
that is why gugusan dedap is selling like hot cake. I think tainia, salvia apartment also got potentials.
other gugusan like gugusan semarak which is nearer to the medical centre can be good investment.
Saturday April 14, 2007
The Star Online
Property tax exemption a double-edged sword
CURRENT TAX MATTER
By DR JEYAPALAN KASIPILLAI
While exempting property transactions from real property gains tax (RPGT) will provide a boost to the real estate sector, the move may also spur greater market speculation. In view of this, the Government’s move to exempt rather than repeal RPGT may provide a safety net over the long term.
THE Real Property Gains Tax Act 1976 (RPGTA) has not been abolished but exempted with effect from April 1. Effectively, the Government has exempted all persons from the provisions of the RPGTA on assets disposed after March 31, 2007. “Person” includes a company, a partnership, a body of persons, an executor of an estate and a corporation sole.
Therefore, all disposals occurring from April 1, 2007 will not only be exempted from the property gains tax but they are no longer required to file the forms referred to as CKHT 1 and 2 for any sale and purchase of property.
There are other monetary gains accruing to both disposers and acquirers of the assets. For example, no solicitor will now charge his client the fees for preparation and filing of the CKHT forms, which are fixed at RM300 and RM200 per form respectively under the Solicitors Remuneration Order 2005.
For over 30 years, RPGT was the only capital gains tax in Malaysia, charged on gains arising from the disposal of real property or shares in a real property company.
The term “real property” includes any landed property in Malaysia such as residential properties (apartments, condominiums and houses), commercial properties (factories, office buildings, shop houses) and land. This move to exempt such gains from tax would boost the real property industry in Malaysia.
The first legislation to tax gains from the disposal of real property was introduced via the Land Speculation Tax Act 1974 (LSTA) which came into force on Dec 6, 1973.
LSTA was introduced to discourage speculative activities in property as such activities triggered artificial market demand in the real estate market. The act provided for a single tax rate of 50% on chargeable gains in properties disposed within two years from the date of acquisition and if the disposal consideration was greater than RM200,000.
The LSTA was, however, repealed in 1975 and replaced by the RPGTA effective from Nov 7, 1975.
Resident individuals were taxed at rates of 0% to 30% depending on the holding period but companies had to pay a minimum of 5% even if real properties were sold after the fifth year. However, an individual who is not a Malaysian citizen or permanent resident will be charged at the rate of 30% of gains made from the disposal of the asset.
The construction sector will gain tremendously from the removal of RPGT as more foreigners will now be lured to purchase local properties.
Available data suggests that prices of properties, particularly condominiums located in the Klang Valley, have risen following the even more pronounced trend in Singapore.
On a positive note, higher property transactions would generate greater stamp duty collections. The revenue generated from RPGT in 2006 was around RM250mil, accounting for 0.4% of direct taxes. As such abolishing the tax is indeed timely.
There are downside risks in exempting RPGT. It is contended that in the absence of RPGTA, taxpayers would shift personal and business income into assets that could then be sold at an appreciated value, which would then appear to make the entire tax system unfair. In a booming property market, capital gains tax not only raises government revenue but more importantly improve economic efficiency.
The authorities had not taken into account inflationary effects when computing property gains tax and this led to inequities and inefficiencies because it may cause taxes to be paid on phantom profits. For instance, gains of real property disposals by a company after five years would attract a 5% tax but it is possible for the company to have incurred a loss after taking into account real and not nominal values. This was one weakness of the real property tax.
Nevertheless, many would argue against introducing indexation of capital gains tax to inflation on the grounds that it was administratively too complex and costly. The RPGT Exemption (No 2) Order was gazetted and published on April 1. To expedite the implementation of the announcement made by the Prime Minister, the Government may have taken this approach in issuing an Exemption Order rather than repealing the Act.
Since RPGTA has not been abolished, it would be easier for policy makers to re-introduce the Act when the need arises to stem unwarranted speculation and curb excessive rise in real property prices.
Dr Jeyapalan Kasipillai is a professor and chair of Malaysian Business at the School of Business, Monash University, Sunway Campus. He is also a council member of the Malaysian Institute of Taxation.
Filed under: Real Estate | Tags: gugusan dedap, kota damansara, salvia apartment, tarnia apartment
Yesterday I called an agent asking a unit at Gugusan Dedap on sale. The agent said the unit already sold out. The unit was at 4th floor and the selling price was RM67,000. Dedap is selling like hot cake right now thanks to Carrefour and Giant hypermarket near by.
The occupancy rate will be higher than current rate. Currently the occupancy rate is around 50%. After completions of those hypermarket of course the occupancy rate will shoot up.
I still wondering how come people buy at high price they still can not get the return. If they increase the rents, their potential tenants will go to the medium apartments tarnia and salvia just besides gugusan dedap.
Anyway still working my way to get one unit there. Wish me luck.
Currently I am scrambling for my money coz an auction is coming in which has a good potential high rental return.
Filed under: Stocks Investing | Tags: affin, AMMB, bchb, eoncap, hong leong bank, malaysian banks, maybank
http://biz.thestar.com.my/news/story.asp?file=/2008/5/21/business/21299021&sec=business
PETALING JAYA: The results recently released by the financial sector have largely been mixed, with some missing estimates and others outperforming market forecasts (see table).
Analysts contacted by StarBiz are not overly concerned over earnings in the sector going forward.
Aseambankers senior analyst Wong Chew Hann said anticipation that the financial sector could be in for hard times in the second half “may not be so”.
“It will be flat,” she said of earnings.
Bumiputra-Commerce Holdings Bhd, the largest player in the segment, has told analysts that the group expects some deals to come in during the second half, thus boosting non-interest income.
Wong said barring any major political disruption which could dampen sentiment for corporate issues, earnings from non-interest income for the sector could improve.
She added, however, that net interest margin could come under pressure but expects strong loan growth to offset the margin erosion, adding: “It’s not going to be exciting but it won’t be bad.”
Banking sector loans growth is closely related to economic performance.
While some economists see a slower second half for Malaysia, many expect any slowdown in the US to be offset by internal demand from the regional economies.
As for Malaysia, there was the advantage of being a large exporter of commodities, which would help offset inflationary pressures from booming commodity prices.
Standard & Poor’s Equity Research Asia director of research Lorraine Tan said in a May 14 report the outfit remained overweight on “financials” in Malaysia.
The research house saw “value among some banks, given the sustained economic growth outlook and limited subprime exposure”.
At the same time, S&P Research Asia is underweight on industrial stocks as it expects margin pressures to continue.
Tan said: “The good news for most emerging Asian banks, and particularly Malaysian banks, is that organic loans growth is relatively stable and the proportion of treasury instruments is minimal.
“As such, we anticipate little risk to most Asian financials and are in fact overweight on the sector in Asia.”
However, Tan added that there remained risks that tempered S&P Equity Research Asia’s outlook.
“Although it would appear that the credit crunch has dissipated, we believe that there remains the potential for additional writedowns by banks exposed to the US market,” she said.
While no Malaysian banks are expected to be directly affected, any bad news is likely to dampen sentiment and lower risk appetite.
S&P believes that speculative default rates should rise to a long-term average of around 4.7% by the end of the first quarter of 2009.
As at the end of the first quarter this year, the default rate was 1.4%.
Although no monetary quantum has been extrapolated, S&P Equity Research Asia estimates that this could amounted to over US$600bil.
Hence, there is a likelihood of additional writedowns as only around US$150bil has been written off to date.
Earnings risks also remain should inflation continue to remain stubborn and if US consumption slows more than expected.
“Last but not least, there remains political uncertainty in Malaysia,” Tan added.
Until this “elephant” left the room, the market was expected to have limited breathing space, the S&P report said.
“With valuations at comfortable levels and with the expectation of new policies potentially leading to greater operating efficiency, we believe that sustained market underperformance would be unlikely,” it added.
http://biz.thestar.com.my/news/story.asp?file=/2008/5/16/business/21268445&sec=business
KUALA LUMPUR: After announcing three acquisitions recently, Malayan Banking Bhd (Maybank) is not in a hurry to pursue another.
“We are so busy with these transactions that we’re not looking at anything else. Our priority is to complete these three acquisitions,” president and chief executive officer Datuk Seri Abdul Wahid Omar said after the company EGM yesterday.
In the past three months, Maybank had proposed to buy An Binh Bank of Vietnam, Banking International Indonesia (BII) and Pakistan’s MCB Bank for a combined cost of almost RM12bil.
With these acquisitions, Maybank’s regional role would be boosted significantly with its presence in seven of the 10 Asean countries.
Wahid said India and Thailand were potential countries to penetrate although the banking group was “not in a hurry”.
Maybank, he said, would continue to expand organically, such as adding more branches to the two it had in Cambodia.
Its shareholders approved the proposal to take over BII yesterday after Maybank presented the rationale for the move as well as the overall strategy in its aspiration to become a leading regional banking group.
The results of the meeting mean “the shareholders voted in our favour,” Wahid said.
Indonesia, being the largest nation in South-East Asia with some 130 million populations, provides a large market with high growth potential, given its low banking penetration.
Furthermore, BII fitted the group’s criteria as it has a good franchise of 230 branches and a strong management team.
“There is also the element of scarcity as BII was the only one available for acquisition among the top 10 banks in the country,” Wahid said.
Maybank would be paying 510 rupiah per BII share, which was “not much higher than the next highest bidder,” he noted.
In determining the bidding price, the group had set a valuation range based on discounted cash flow. The price of 510 rupiah is at the top end of the range.
After this, Maybank would be seeking approval from the Indonesian authorities as well as clarity on the country’s single presence policy, which prevents controlling shareholders from having stakes in more than one bank in Indonesia.
There was concern earlier that Maybank and CIMB group, being government-linked entities, would be subject to the single presence policy.
As the two banking groups did not share the same shareholders, the policy did not apply to Maybank, Wahid said, adding that the BII acquisition was expected to be completed by end-June or early July.
On recent criticism on the BII acquisition, he said Maybank would explain the rationale of the BII deal in Parliament soon.
Meanwhile, he said, the proposed acquisition of MCB demanded a premium due to its position as the fourth largest bank in terms of assets and biggest in market capitalisation in Pakistan.
MCB also enjoyed a high net interest margin of 8% compared with the industry’s average of 6%, he added.
Maybank reiterated its commitment to paying out 60% of net profit as dividends. Wahid said the final dividend would be announced in August together with its full-year results.
The group planned to release its optimum capital structure plan by end-June, he said, adding that it intended to achieve an ideal risk weighted capital ratio of 11% to 12.
http://biz.thestar.com.my/news/story.asp?file=/2008/5/15/business/21257838&sec=business
KUALA LUMPUR: Malayan Banking Bhd (Maybank) yesterday posted a flat third quarter ended March 31 as its financial performance was hampered by the weak capital market.
The country’s largest bank by assets said its stagnant profit was due to unrealised mark to market loss of securities and derivatives, and net of writeback of impairment losses in securities amounting to RM353.4mil compared with RM90.4mil in the previous corresponding period.
Maybank was, however, pleased with its growth in consumer banking, insurance and international operations, as well as lower loan loss provisions during the period.
Maybank announced a net profit of RM758.6mil, or 15.52 sen a share, during the quarter compared with RM764.6mil, or 15.8 sen a share, in the previous corresponding period.
Revenue dropped to RM3.74bil from RM4bil previously while pre-tax profit dipped marginally to RM1.02bil from RM1.03bil.
In a filing with Bursa Malaysia, the bank said its focus on improving asset quality as one of its operational strategies to enhance bottomline growth resulted in a lower provision for loan loss of RM451.9mil compared with RM647.7milpreviously.
Its net non-performing loans ratio improved to 2.43% from 3.56%.
For the nine months to March 31, Maybank announced a net profit of RM2.22bil, or 45.67 sen a share, compared with RM2.13bil, or 44.33 sen a share, in the previous corresponding period.
According to a poll of 25 analysts on Bloomberg, the forecast net profit for Maybank for its financial year ending June 30, 2008 is RM3.35bil.
Group pre-tax profit for the nine months increased by 1.2% or RM34.9mil to RM3.07bil compared with RM3.03bil in the previous corresponding period.
Maybank said consumer banking revenue for the nine months was up 13.1% to RM2.96bil, insurance rose 3.1% to RM532.6mil and international operations up 12.6% to RM1.08bil.
Commenting on the group’s international operations, Maybank president and chief executive officer Datuk Seri Abdul Wahid Omar in a statement said its higher revenue translated into a 32.6% rise in pre-tax profit.
“The contribution from our international operations in terms of pre-tax profit to the group continues to grow, reaching 18.7% in March 2008 compared with 15.6% in March 2007. This is a result of our strategy to steadily expand this area of business and tap on the significant growth potential in the region,” he said.
On its outlook, Maybank said the prospects of a slowing US economy that threatened to slide into recession presented a downside risk to Malaysia’s external sector, especially in curbing manufacturing exports growth.
“Nevertheless, domestic and business spending is expected to remain resilient, upheld by sturdy consumer spending, despite some risk of inflationary pressures.
“However, overall, the slightly restrained economic performance would still provide sustained growth in interest income and recurring non-interest income. The group is confident of sustaining the current performance for this financial year,” it said.
Maybank EGM on 15/05/2008. I wonder whether should I come to this EGM or not. I have so many things to do. I would like to come because I dont agree with the management on purchasing BII at an expensive price. I think other investors also think this way that why Maybank share dipped recently.
The EGM will be held at Crown Hotel. I think I have to pass this EGM. So I can make more money. By the way my vote can’t even change the management decision.
http://biz.thestar.com.my/news/story.asp?file=/2008/5/13/business/21230865&sec=business
KUALA LUMPUR: Shares in Public Bank Bhd rose to a fresh record yesterday as investors switched from their shareholdings in Malayan Banking Bhd (Maybank).
Analysts said apart from becoming the country’s largest bank in terms of market capitalisation, Public Bank’s strong balance sheet, impressive capital ratios and high growth numbers were the added attractions to investors.
“Investors may (also) be looking at Public Bank for its dividend angle,” said one analyst.
The stock closed up 20 sen at RM12.
Public Bank shares have been rising since the middle of March when it was trading at RM9.80 a share. Its uptrend coincided with the time when news of Maybank’s interest in Bank Internasional Indonesia (BII) first surfaced.
Confirmation of Maybank’s bid for BII towards the end of March and the group’s subsequent proposal to buy a 15% stake in Pakistan’s MCB Bank Ltd further soured investor appetite for the stock.
Investors were turned off by the high price for the BII bid, and to a lesser extent the purchase of MCB Bank. They also found the prospect of a lower dividend from Maybank difficult to swallow.
The confluence of disappointing news from Maybank has led to its share price sliding from a high of RM9.92 on Feb 14 to RM7.85 yesterday. However, as Maybank’s share price fell, Public Bank’s shares went in the opposite direction.
Analysts said that apart from Public Bank’s dividend of 75 sen a share in the last financial year against 60 sen a year earlier, investors were also pleased with the group’s solid fundamentals.
One analyst said Public Bank’s loans growth of over 20% on an annualised basis and its strong balance sheet made it a top choice among banking stocks in the country.
“Public Bank’s business in Hong Kong, China and Cambodia is growing strongly,” said one analyst.
The rise in Public Bank’s share price has put its valuations at the upper tier in terms of price to book and price to earnings but analysts feel that the growth the stock has been displaying over the years justify such valuations.
Of the 18 analysts polled by Bloomberg, none have a sell call on the stock.
0648 GMT [Dow Jones] STOCK CALL: UBS cuts Malayan Banking (1155.KU), or Maybank, target price to MYR9.80 from MYR10.70, based on revised FY09E ROE of 17.2% vs 17.6% previously on account of lower dividend payout, lower growth rate assumption of 4.5% vs 5% previously. Follows proposed acquisition of 15% equity stake in MCB Bank (MCB.KA) US$686 million cash, with implied P/BV of 5.13X 2007. Notes Maybank has made three regional acquisitions costing MYR11.8 billion within past 2 months; says management earlier indicated BII (BNII.JK), An Binh Bank acquisitions could be funded via excess capital, new sub-debt/hybrid tier 1. “We believe the MCB acquisition puts further pressure on Maybank to explore the option of raising fresh equity (UBS estimate of MYR2.5 billion). This could translate to a 3% dilution in FY09E EPS.” Keeps at Buy. Share down 3.8% at MYR7.70. (LES)
http://biz.thestar.com.my/news/story.asp?file=/2008/5/3/business/21142374&sec=business
KUALA LUMPUR: Malayan Banking Bhd (Maybank) plans to announce a major acquisition on Monday amid speculation it wants to buy a strategic stake in Pakistan’s MCB Bank.
Maybank suspended dealing in its shares until the close of trading on Monday.
The announcement was due on Monday, a banking source added.
MCB is Pakistan’s largest bank in terms of market value and is worth around US$4bil. Pakistan’s strong- performing banking sector ranks among the world’s most profitable after five years of financial reform, economic growth and rising incomes.
One dealer at a Malaysian brokerage said Maybank was set to make an acquisition in Pakistan, despite facing criticism over paying too much for a stake in an Indonesian bank in March.
The Karachi market was buzzing with speculation that Maybank could bid up to around 510 rupees per share for an MCB stake of between 10% and 20%. That would amount to almost six times book value, according to Reuters data. – Reuters
