PETALING JAYA: Furniture-maker DPS Resources Bhd, which plans to diversify into the construction and property sectors, is proposing to undertake a mixed housing development in Malacca via a joint venture (JV) with a private company.

The group expected the venture to make up at least a quarter of its annual future net profits.

“The company also anticipates that the property business will contribute positively to its earnings in the future, as the group continues to seek and secure more construction projects,” it said in a filing with Bursa Malaysia.

DPS said its wholly-owned subsidiary, Shantawood Sdn Bhd, is proposing to tie up with Biotrend Estate Sdn Bhd to develop a mixed housing project on 38-acre agricultural land in Tanjong Minyak.

The proposed JV will increase the estimated gross development value of DPS’ property development projects from RM23.34mil to RM189.61mil.

“It is in line with the group’s long-term strategic plan to augment its property development business and is expected to sustain the property development segment of the DPS Group for the next six years,” it said.

DPS added that the land is located 15km to the north-west of the Malacca city centre and about 1.8km off the southern side of Lebuh SPA (dual carriageway linking Ayer Keroh to Paya Rumput and Sungai Udang).

As a result of the proposed JV, DPS also said it intends to diversify its existing business to include construction and property investment.

“The expansion into the property business, which is a direct consequence of the proposed JV, represents the group’s diversification initiative of tapping into the potential of the property business.

“This initiative is part of the group’s long-term strategy of diversifying into other industries with growth prospects, after considering the overview and outlook of the Malaysian economy, property market in Malaysia as well as the potential profits to be derived from the project and future earnings contribution to the group,” it said.