RM1.5bil affordable housing project

  • Property
  • Thursday, 12 Sep 2013

PR1MA housing project

PETALING JAYA: Construction company Pesona Metro Holdings Bhd is a frontrunner for a massive RM1.5bil housing project under the Government’s 1Malaysia People’s Housing Scheme or better known as PR1MA.

Sources said the company, which was listed via a reverse takeover last October, is likely to be chosen due to its “expertise” and “track record”.

There were four other bids that were submitted for the job, which should take some 30 months to complete once it is awarded, a source noted.

An announcement on this will be made earliest in two weeks’ time.

Since its debut on Bursa Malaysia, Pesona has been relatively quiet until recently, that is.

In June, it announced that it had obtained an RM87mil job for the proposed construction and completion of the remaining and rectification works of a government office building.

Pesona had declared last October that it was bidding for construction projects under the PR1MA programme.

If this RM1.5bil job does go to Pesona, then it would more than triple its current orderbook of about RM570mil, making it a major construction concern.

Shares in Pesona ended 6% higher to 50.5 sen on a volume of 20.7 million shares at yesterday’s close.

It was announced last month that more than 20,000 homes would be built under 15 affordable housing projects in Greater Klang Valley, Johor, Penang, Sabah and Sarawak.

These 15 projects come under Phase 1 of the PR1MA programme, an affordable housing scheme announced under Budget 2013.

PR1MA Corp Malaysia chief executive officer Datuk Abdul Mutalib Alias had said last month that specifications of the houses, including pricing and floor plans, would be announced in the next few months.

However, it has been reported that the homes would be priced under RM350,000 per unit.

Recall, Pesona took over the listing status of financially-beleaguered Mithril Bhd last year amid a restructuring exercise.

It had raised more than RM10mil for working capital via the issuance of 40 million new shares of 25 sen each then.

While Pesona may not immediately be a recognisable name, it has completed more than 30 projects valued at more than RM1.5bil.

Among its completed projects are a flood mitigation project in Sungai Kerayong, Kuala Lumpur, the construction of the Timah Tasoh Dam in Perlis and the Zehn Luxury Condominium at Jalan Bukit Pantai, Kuala Lumpur.

The company is also responsible for the construction of the Customs, Immigration and Quarantine Complex in Melaka, which it completed and handed over in the last financial year ended Dec 31, 2012 (FY12).

Citing internal projections, sources said the PR1MA project is expected to yield Pesona some RM202.5mil in net profit based on a projected 13% profit margin.

This is huge in comparison to its current earnings. For its six months ended June 30, Pesona’s net profit stood at RM8.39mil on a revenue of RM154.32mil.

For FY12, its net profit was at RM11.78mil on a revenue of RM220.78mil.

The group’s current net assets per share stands at 14.50 sen per share. It has cash and bank balances of RM25.5mil with minimal borrowings.

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