This will keep the company busy for the next five years
KUALA LUMPUR: Construction work to extend the Duta-Ulu Kelang Expressway (Duke) will boost Ekovest Bhd’s order book to RM13bil, according to its managing director Datuk Seri Lim Keng Cheng.
“The RM13bil construction order book will keep us busy for the next five years,” Lim told a press conference after an EGM yesterday.
The extension work, known as Lebuhraya Duke Fasa 2A (Duke2A) project, was clinched by the company earlier this week.
Ekovest, through its subsidiary, would undertake the construction of 75.2km of roads here, which would link the various expressways at a total cost of RM6.32bil.
“I think this is the missing link in the network of roads in the Klang Valley as it will link key highways. This will be built instead of City Hall’s local council road.
“The Duke highway is basically a connector and since Kuala Lumpur has 13 highways, we will connect them all,” Lim said.
Ekovest has received a letter from the Government on the principle approval of the proposed privatisation of the Kampung Baru link, Istana link and Kapar link expressway.
“It will be financed through a consortium of banks.
“The extension of the entire highway including Duke2A will be completed by 2030,” Lim said.
At the EGM, shareholders unanimously approved the 40% stake disposal in phases one and two of the Duke highway to the Employees Provident Fund (EPF) for RM1.13bil. Lim said the disposal to the EPF was part of its strategy to strengthen its balance sheet to take on more projects such as the Duke2A.
The company’s net gearing ratio is expected to be lowered to 0.38 times after the exercise is completed.
“This is the main reason we are divesting the 40% to the EPF so that we will have enough funds for this new project,” he added.
Asked if the company would require more investors to fund the project, he said that the matter had not been determined.
On whether margins would be impacted by the rising construction cost, he said that 35% of the cost had already sunken due to the usage of fabricated moulds that had already been prepared earlier.
“For our highway, we have the mounds for the beams and pillars. We will still be using the same set of equipment for Duke2A. We will overcome the increase in the prices of steel bars and I also foresee that we will have slightly higher margins,” Lim said.
Commenting on its River of Life project, Lim said the company had secured two more contracts and hoped that it would obtain another deal soon.
On its property segment, the company planned to launch the remainder two blocks of Eko Titiwangsa in the middle of this year and Eko Cheras is expected to be completed by the year-end.