Mah Sing ... Feb 2009

It plans to use its cash pile of RM150mil as at Dec 31, 2008 to acquire new land locally and in other regional markets to realise its vision as a regional property player.

The company was in a good position to make some opportunistic acquisitions to lock in land which had dropped in value following the global financial meltdown. Its strong balance sheet will enable us to expand our presence and ensure healthy earnings growth.

While moving ahead with its plans to become a regional player, the company would be prudent in its cashflow management and not over-commit.

Mah Sing hopes to finalise its first overseas deal this year (2009) and to launch its maiden offshore project next year (2010). The markets being targeted include Vietnam, China, India and Indonesia.

Locally, the company recently purchased 2.12ha of freehold land in Setapak and 26.8ha in Sri Pulai Perdana 2 in Johor Baru.

In addition to these acquisitions, it has 11 projects in the Klang Valley, four in Johor Baru and one in Penang. The company’s remaining landbank of 231.6ha has an estimated RM3.9bil in remaining gross development value and unbilled sales which will sustain earnings growth for the next five to seven years.

Despite the gloomy market outlook, Mah Sing’s quick turnaround business model, focusing on niche medium to high-end landed developments, had generated healthy profits and cashflow.

As they have pre-constructed some of its properties in certain key projects which are locked in at the old construction costs, they are able to continue launching the projects. They will take advantage of some RM282mil worth of pre-constructed products in projects like Aman Perdana, Kemuning Residence and Sierra Perdana, to market completed units at the right pricing.

Mah Sing’s exposure in the three growth corridors of the Klang Valley, Johor Baru and Penang, coupled with a healthy mix of residential and commercial projects, would ensure good growth sustainability for the company, he said.

Its Grade A office, The Icon Jalan Tun Razak which will be completed by June 2009. Southgate in Jalan Sungei Besi has also done very well, achieving RM150mil in sales since last March 2008