Monday, April 8, 2013

PARAMON ... Apr13

It is looking at a fresh round of fundraising in the third quarter 2013 despite having just inked a rm550 million debt cum equity plan in Feb 2013, comprising a rm350 million sukuk programme and a rm200 million perpetual bond.

The group will deploy the capital to acquire morel and as well as invest further in its education business under the KDU and Sri KDU brand.

It will be both debt and equity funding. The ideal debt to equity ratio for Paramount is 0.5 times.

It is controlled by one branch of the See Hoy Chan Group’s Teo family. It will still looking for additional funding over the medium term to raise more equity and debt

It will have to continue increasing its landbank and presence in education.

The group is in a position to churn out more projects higher revenue, as it already owns landbbank that could generate some rm7 billion in outstanding GDV. With rm4.2 billion slated for development within the next five years from 2013.

It will also redevelop certain sites that are currently (March 2013) used for campus of its education ventures.

Some of the group’s biggest projects in the Klang Valley is the 33.1 acre Klang Town land with rm1.91 billion in GDV, 11.8 acres in Glenmarie (rm945 million), 5.2 acres in Section 13, PJ (rm700 million) and 9.4 acres in Lots 7&9 in Kota Damansara (rm600 million).

Its parcels in Section 13, Damansara Jaya and Lots 7&9 are turning out to be prime land but the good thing is that it was acquired many years ago with low holding costs to the group.

On its future landbank, Paramount wants to spread its wings to the northern region especially the greater Penang area.

The group is looking to grow the size of its investment properties to about 20% of its total assets within five years from 2013. It will do so by keeping some of the retail lots for rental income.

It is not planning to make a private placements to institutional investors.

Teo Chiang Quan’s family owns about 27.63% stake in Paramount, followed by Banting Hock Hin Estate Co Sdn Bhd with a 16.3% stake.

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