Would You Buy DNP Based ON DBS Report?

If you wanna sell a story, make it as sexy as possible.

If not your story won't sell!

Heard that before?

How about stocks?

If you want to promote a stock, should you not attempt to make the stock as promising (sexy) as possible?

No?

Here's an example posted on Business Times: DNP profit forecast to leap on good project prospects

Profit forecast to leap? Is this saying that this event, the 'profit forecast' WILL happen?

Oops... it's just profit forecast or profit estimate.

Surely I cannot 'assassinate' the article just because some is making a much 'optimistic' profit estimate or can I?

Anyway here's what's written. I will add in some comments in colored fonts.

• DNP profit forecast to leap on good project prospects
  
  By Francis Fernandez Published: 2009/09/09
  
  HIGH-END property developer DNP Holdings Bhd, which could be rebranded into Wing Tai Malaysia in the near future, is poised for a quantum leap in profits. (hmm... all this is based on an assumption that DNP could be rebranded into Wing Tai Malaysia. An event that has not happened, yes? A speculation? )
  
  For the year ended June 30 2009, DNP posted a net profit of RM14 million, but DBS Group Research forecast net profit could soar to RM114 million by the 2012 financial year. (holy sweet cow! from a net profit of 14 million to 114 million by 2012??? a 10 times increase in earnings! Errr.... wazzap doc? Is there a global property boom happening? lol! )
  
  For the year ending June 2010 and 2011, DBS forecast a net profit of RM51 million and RM78 million respecitively. ( err ... as it is... DNP last reported earnings is here. Have a look. Quarterly rpt on consolidated results for the financial period ended 31/3/2009 and this is their previous fiscal year q4 earnings Quarterly rpt on consolidated results for the financial period ended 30/6/2008 )
  
  DNP is 54 per cent owned by Wing Tai Holding Ltd, a Singapore public-listed company which has created a niche reputation as one of the island state's top high-end residential developers.
  
  DNP's second largest shareholder is former banker Chua Ma Yu, who owns 2.83 per cent of the company as at end-September last year.
  
  The report said DNP has been marketing its KL high-end segment under the umbrella of Wing Tai Asia, to help ride on its parent's strong brand name.
  
  "We do not discount the possibility of DNP being rebranded in the near future," Mei Hui Yee, an analyst with DBS wrote in a report initiating coverage on the residential developer with a price target of RM2.60 a share.
  
  "We conservatively expect DNP's earnings to leapfrog by 3.7 times over the next three years. If all launches go ahead as planned, there could be a further 40 per cent upside to our earnings estimate," Mei wrote in the report. ( LOL! CONSERVATIVELY???? )
  
  DNP has about RM1.5 billion of upcoming high-end launches around Kuala Lumpur's Golden Triangle over the next few months.
  
  Among its forthcoming launch is the Verticas Residensi at Bukit Ceylon, which has a gross development value (GDV) of RM726 million. The project comprises 423 condo units priced at a minimum of RM1.2 million a unit.
  
  "We understand 64 per cent of the 70 units opened to registrants have been sold to date (within just one month) despite the price tag and ahead of management's expectations," Mei wrote in the report.
  
  DNP is also expected to launch by year-end a high-end condominium project that comprises 25 units priced at RM3.5 million a unit. The condos have a built-up area of between 3,000-3,500 sq ft.
  
  It is also expected to launch 197 units of luxury condos just opposite the Petronas Twin Towers by next year. The project is estimated to have a GDV of RM703 million.

And here it is... just for the record. :D

ps. I do understand that perhaps DBS had written the report much earlier and that Business Times might probably be a bit late in publishing what's stated in the report. So if you did not get the report much earlier... this is where you are buying!