Eco World set to hit RM4bil sales target

Developer eyes RM4.5bil in 2017 with launch of new phases

Eco World Development Group Bhd is optimistic of achieving its RM4bil sales target this year and hopes to increase this to RM4.5bil in 2017.

Amidst the soft property market, president and chief executive officer Datuk Chang Khim Wah said the group’s sales would be underpinned by the launch of new phases and introduction of new products from its on-going projects.

In 2015, Eco World hit its projected RM3bil sales target, noted Chang.

“With sales from 11 on-going projects going strong, and new projects lined up like Bukit Bintang City Centre (BBCC) located at the former site of Pudu Jail and Eco Business Park II close to Senai Airport in Johor, we are pretty much on track with what we have projected,” Chang told reporters on the sidelines after Eco World’s annual general meeting and extraordinary general meeting (EGM) here yesterday.

At the EGM, shareholders had approved the resolution to acquire 2,198.4 acres of 26 parcels of leasehold land in Mukim Ijok in Kuala Selangor via its unit Paragon Pinnacle Sdn Bhd for RM1.181bil.

Eco World would undertake a mixed development project on the land that includes a mixed eco township and an integrated gated industrial hub. The development will also have affordable homes for settlers.

The entire project is estimated to take 15 years to complete and has an estimated gross development value of RM15bil.

As for the BBCC, Chang said it was expected to be launched in the second quarter of calendar year 2016 and would be open for public viewing soon.

Up till February, Eco World achieved sales of RM607.8mil, of which RM344.6mil were from Klang Valley projects, RM233.1mil from Iskandar Malaysia and the remaining RM30.1mil was topped up by projects in Penang.

Eco World’s net profit for the first quarter ended Jan 31,2016 increased to RM20.67mil from RM3.06mil, a year ago, on the back of a 193% surge in revenue to RM463.51mil. Earnings per share improved to 0.87 sen from 0.60 sen. The group’s on-going projects include Eco Majestic in Semenyih, Eco Meadows in Penang as well as Eco Botanic, Eco Tropics, Eco Summer and Eco Spring in Iskandar Malaysia, apart from the Business Parks.

On Iskandar Malaysia, Chang said despite the glut among the Chinese developers, Eco World recorded strong sales.

“For 2015, we hit RM1.2bil sales in Iskandar Malaysia alone.

“The focus in Iskandar Malaysia has always been gated and guarded landed properties, including commercial development,” he added.

Meanwhile, he said Eco World’s focus in Penang would be the mainland, as it was part of its long term strategy to establish the township catchment market there.

Chang said that piling works were now ongoing for RM430mil Eco Terraces high-rise condomium project in Paya Terubong, Penang, while the RM10bil Eco Marina project in Batu Kawan was still awaiting for approvals.

Asked to comment on a Wall Street Journal’s article dated March 23 that Eco World International had started talks with several entities that it hopes will buy a chunk of shares of the company at an agreed prices ahead of the IPO, Eco World executive director and chief financial officer Datuk Heah Kok Boon replied that it was in talks with the Securities Commission (SC) and presentation has been made.

“We hope to make a decision in the near future, but we rather not comment on specifics because we are still awaiting for SC’s approval,” he noted.

The Wall Street Journal reported sources saying that Eco World International was looking at cornerstone investors, both local and international to buy its shares.

Potential investors being approached include Malaysia’s pension fund such as Employees Provident Fund, said the report. - The Star