KUALA LUMPUR (Feb 14): Suiwah Corporation Bhd rose as much as 16% in morning trades as the firm is said to develop a mixed development project with gross development value (GDV) of RM300 million on Penang Island.

At 10.16 am today, the group that operates supermarkets, departmental and convenience stores, rose 27 sen or 13% to RM2.37. The top gainer saw trades of 199,600 shares.

In a note today, Public Investment Bank Research said the development project is situated in the established Air Itam area, also known as Farlim, and construction is expected to commence this year.

“We understand from various sources that the 9-acre plot in Bandar Baru Air Itam will be developed into a mixed development project,” said the Public IB research team.

“This consists of two blocks of serviced apartments and SOHOs.

The research team said investors have overlooked Suiwah’s valuable landbank in Bandar Baru Air Itam, Penang Island and its newly-opened shopping mall in Bertam, Seberang Prai, which is fully tenanted.

“We see underlying value in the company’s landbank, which could value Suiwah of at least RM274 million or RM4.78 per share,” it said.

This compares to Suiwah’s current market capitalisation of RM120.4 million that has only factored in the value of its retail business, manufacturing division, Sunshine Square property and net cash.

The research team pointed out Suiwah had a  consistent dividend payout and healthy balance sheet.

However, the research team said does not have a rating on the stock.

Meanwhile, Kenanga Research said Suiwah would see immediate technical support and resistance levels at RM2.02 and RM2.10 respectively.