“We will be launching something new every month for the remainder of 2016,” group managing director and chief executive Tan Sri Leong Hoy Kum(inset) told StarBiz.
KUALA LUMPUR: Property developer Mah Sing Group Bhd will up its game in the second half of the year, signalling its optimism that the slowing property sector is at its tail end.
“We will be launching something new every month for the remainder of 2016,” group managing director and chief executive Tan Sri Leong Hoy Kum told StarBiz.
He said Mah Sing, which is sitting on a cash pile of RM1.1bil and has a near-negligible net gearing of 0.09 times, would be promoting its products “aggressively”.
Leong said he expects sentiments to improve next year and that the company was already “setting the plan in motion” to catch the market when it turns.
Mah Sing has set a sales target of RM2.3bil for 2016. The company has about RM2bil worth of projects to be launched for the remainder of the year.
Leong pointed out that the company had launched some products in 2015 that it will continue to sell this year to meet its sales target. “This year, the target is RM2.3bil. When the market turns, we will ramp it up to between RM3bil and RM4bil. It’s pointless to force it (higher earnings) in a downturn,” he said.
Leong is optimistic that the property market will start seeing improvements next year.
“This year, the market is still a bit cautious. Next year, we will see some improvements. Malaysia’s unemployment rate is still low. Banks are also prepared to lend, provided the buyer is eligible.”
In a downturn, he said it was important to plan and launch products that were in line with what the market wanted.
“With the right product, once you approach the right buyer, you should still be able to grow. There’s no point approaching someone who can’t afford to buy a product - and then keep talking to him.”
Leong emphasised that that was why the company was looking to tie up with the Government and build affordable homes for the mass market.
“That’s why we are joint-venturing with the Government - both the state and federal.
“The talks are promising, as the Government is also looking for good partners and developers with a proven track record and delivery.”
Leong said that the Government had a lot of land, adding that a tie-up at this point would be beneficial to both parties.
Mah Sing is currently looking for land in Greater KL, the Klang Valley, Iskandar Malaysia and Seberang Prai and is not looking to venture outside Malaysia.
The company currently has 46 development projects under its belt, with 35 already in various stages of development. It has 2,522 ha of existing land bank, which will keep the company busy for the next eight years.
It has 22 projects within the Klang Valley; seven in Johor; four in Penang and two in Sabah.
For its first quarter ended March 31, 2016, the group’s remaining gross development value and unbilled sales stood at about RM32.26bil.
The company registered a 3.9% lower net profit of RM95.04mil during the quarter, while revenue fell 9.5% to RM709.17mil compared with a year ago.
> Watch out for the story on Leong’s legacy plan tomorrow.
