It will be pocketing RM798 million from the sale of 1,021 acres of land in Kuala Selangor for the development of a mega industrial park.
In an exchange filing yesterday, the group announced the disposal of 1,021.93 acres of freehold agricultural land in Bukit Kerayong, Kuala Selangor for RM798.3 million to Kerayong Development Consortium Sdn Bhd, a newly established 50:50 joint venture (JV) with its sister company Sime Darby Property Bhd.
The purchase consideration for the land purchase will be funded through a combination of the JV’s internally generated funds and bank borrowings, according to the companies’ bourse filings. The proposed land disposal is expected to be completed this year.
Both companies are simultaneously committing up to RM100 million to the JV to develop a large-scale industrial park on the land.
This constitutes part of a larger master plan to jointly develop 3,000 acres of land in Kuala Selangor into a next-generation industrial park anchored by logistics and renewable energy infrastructure.
Public Investment Bank (PublicInvest) said the transaction “monetises low-yield plantation land at an attractive valuation while allowing SD Guthrie to retain recurring earnings contribution through its equity participation in the JV development”.
It views the transaction price of RM17.93 per sq ft as fair, given its current agricultural land status, strategic location, accessibility, and potential value from industrial land conversion.
“We view this transaction positively as the group is expected to reap a significant gain of RM408 million, translating into an additional earnings per share (EPS) of 5.9 sen,” it said in a note today.
Strategic location
PublicInvest said the Bukit Kerayong development, strategically located near to Port Klang, is positioned to capture logistical demand driven by structural shifts in global supply chains.
It noted the site sits adjacent to the West Coast Expressway and is positioned within 4.5km of the East Coast Rail Link’s (ECRL) Kapar and Puncak Alam stations, scheduled for completion in late 2026.
The project also complements SD Guthrie’s adjacent integrated flagship township, Bandar Bukit Raja, and ties into regional corridors expanding towards Carey Island, where 85% of the land, or 11,000ha, is owned by the group.
“Assuming the unconverted agricultural land is valued at RM8 per sq ft, it could be worth almost RM10 billion or 22% of its current market capitalisation,” it added.
PublicInvest, which kept its “outperform” call on SD Guthrie with an unchanged target price (TP) of RM7.23, said the transaction could bump up its FY2026F earnings forecast by about 17%.
The bank also maintained its “buy” recommendation on Sime Darby Property with an unchanged TP of RM2.10.
It said the development project combines SD Guthrie’s strategic landbank with Sime Darby Property’s industrial development expertise, providing a platform to unlock a new industrial growth corridor in Kuala Selangor.
The transaction is classified as a related-party deal as both companies share the same institutional backer – Permodalan Nasional Bhd (PNB) and its parent company Yayasan Pelaburan Bumiputra.
PNB’s AmanahRaya Trustees Bhd–Amanah Saham Bumiputera holds a 37.48% stake in SD Guthrie and a 32.7% direct interest in Sime Darby Property.
SD Guthrie’s shares closed eight sen or 1.2% higher at RM6.70, giving it a market capitalisation of RM46.34 billion. Sime Darby Property edged up two sen or 1.5% to RM1.38, valuing the group at RM9.39 billion. - FMT
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