{"id":324586,"date":"2023-08-23T23:50:47","date_gmt":"2023-08-23T15:50:47","guid":{"rendered":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/?p=324586"},"modified":"2023-08-23T23:50:48","modified_gmt":"2023-08-23T15:50:48","slug":"stock-in-focus-sm-prime-holdings-smph-23-aug-2023-by-rcbc-securities","status":"publish","type":"post","link":"https:\/\/www.pinoyinvestor.com\/smartinvestor\/stock-in-focus-sm-prime-holdings-smph-23-aug-2023-by-rcbc-securities\/","title":{"rendered":"Stock in Focus: SM Prime Holdings (SMPH) – 23 Aug 2023 by RCBC Securities"},"content":{"rendered":"\n

Summary of Broker’s Recommendation<\/h2>\n\n\n\n
Stock Code<\/strong><\/td>SMPH<\/td><\/tr>
Company Name<\/strong><\/td>SM Prime Holdings<\/td><\/tr>
Broker<\/strong><\/td>RCBC Securities<\/td><\/tr>
Opinion Issued on<\/strong><\/td>23 Aug 2023<\/td><\/tr>
Recommendation<\/strong><\/td>Buy<\/td><\/tr>
1-Year Target Price<\/strong><\/td>PHP 42.80<\/td><\/tr><\/tbody><\/table><\/figure>\n\n\n\n

We raised our 2023\/2024 Earnings per Share (EPS) by 8%\/12% as we (1) impute higher mall EBITDA margin assumptions and (2) increased our residential revenue estimates. That said, we upgrade our Target Price to Php42.80. We maintain our BUY rating on SMPH.<\/p>\n\n\n\n

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Analysis and Opinion<\/h2>\n\n\n\n

Net income up 38% to Php19.4 billion<\/strong><\/p>\n\n\n\n

SMPH posted 2Q 2023 net income of Php10.0 billion, up 49% year-on-year (y\/y), bringing 1H 2023 net income to Php19.4 billion, tracking ahead of our estimates (~54% of 2023 forecasts), but in-line with consensus estimates (~49% of 2023). <\/p>\n\n\n\n

In 1H 2023: (1) Philippine mall revenues grew 53% y\/y to Php31.5 billion, while
China mall revenues inched 3% higher y\/y to RMB398 million, or Php3.1 billion, (2)
residential revenues rose 5% y\/y to Php17.6 billion, while reservation sales climbed
15% y\/y to Php68.5 billion, (3) operating income hiked 36% to Php29.0 billion.<\/p>\n\n\n\n

Philippine mall revenues continue; China malls recover<\/strong><\/p>\n\n\n\n

Philippine mall revenues in 2Q 2023 ended at Php16.1 billion (+30% y\/y, +5% q\/q), sustaining its post-pandemic growth momentum driven by positive consumption trends. Meanwhile, 2Q 2023 China mall revenues rose 9% y\/y to RMB0.2 billion (Php1.5 billion) due to the removal of COVID restrictions.<\/p>\n\n\n\n

Robust residential take-up; payment scheme starts tightening<\/strong><\/p>\n\n\n\n

Residential take-up in 2Q 2023 reached Php32.7 billion (+16% y\/y, -9% q\/q), the 2nd
highest quarterly take-up after posting record high of Php35.8 billion in 1Q 2023. This was driven by the take-up of mid-rise buildings in Mega Manila and provincial areas. Residential revenues also climbed to Php9.9bn on improved bookings, while unsold inventory as of end-2Q23 declined to 19.5k units (vs. ~22.5k units as of end-4Q22). Management stated that they started tightening its payment schemes by increasing its reservation fees to Php20k-Php25k per unit in order to improve the quality of its residential buyers. Moreover, SMPH targets to increase its project launches to 12k-15k units in 2023 (vs. ~8.7k units in 2022).<\/p>\n\n\n\n

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Check how many brokers recommend this stock<\/h2>\n\n\n\n
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All Stock Rankings<\/a><\/blockquote>