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Friday, July 1, 2011

Mah Sing banking on govt to hit RM5b target

KUALA LUMPUR: Property developer Mah Sing Group Bhd is eyeing government-related projects to help achieve its aim of RM5 billion in market capitalisation in five years.

With its track record and healthy financial standing, the company is optimistic of being able to work with the government especially in the 1,200 hectares of Rubber Research Institute Malaysia land in Sungai Buloh and the old Sungai Besi airport land, which is slated to be transformed into Bandar Malaysia.

Mah Sing's current market value stands at RM2.2 billion, having expanded tenfold from just RM189 million in 2005.

"Being a healthy company with a good track record and strong financial position, we believe the group definitely stands a good chance in these projects," managing director Tan Sri Leong Hoy Kum said after its annual general meeting yesterday.

"Mah Sing is very keen to participate in these projects via joint venture or land acquisition," he added.

To date, the group has 34 ongoing projects in the Klang Valley, Penang and Johor Baru, which yield a combined remaining gross development value and unbilled sales of RM14 billion between five and seven years.

Halfway into year 2011, the group has already achieved close to 60 per cent of this year's sales target of RM1.15 billion.

Mah Sing reported a higher net profit at RM41.2 million from RM28 million before for the first quarter ended March 31 2011. Revenue was 31 per cent higher at RM311.8 million.

Its shares closed 1 sen higher yesterday to RM2.61 with a volume of 393,700 shares.

Research firm Macquarie Equities Research has forecast that Mah Sing's earnings will grow at a compounded annual rate of 54 per cent for the financial years 2011 until 2013.

Meanwhile, Leong expects the positive sentiment in the property market to continue, riding on the favourable employment conditions and stable economic growth.

"It is a good time to buy properties now in view of the rising construction cost environment as buyers can lock in current property prices and enjoy borrowing rates, which are still very reasonable," he said.

Other factors that will help to drive the property sector include high impact projects like the MRT (mass rapid transit), young population base, high saving rates and affordable homes.

By Business Times

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