KUALA LUMPUR: Radium Development Bhd
is banking on its niche as a Kuala Lumpur-centric property developer with a focus on affordable high-rise residential projects to spur growth, going forward.
Group managing director Datuk Gary Gan Kah Siong said affordability and accessibility to public amenities and highways were some of the main characteristics of the group’s projects.
“Our price target is between RM300,000 and RM600,000, which is an affordable range. Our target buyers are those who have graduated and worked for a few years.
“Some of the criteria that we have in choosing a land to develop is that it has to be near the light rail transit, mass rapid transit, major highways, and a hospital or school.
“In purchasing a property, location is very important. As such once the location is selected properly, generally sales will come in automatically,” he said at a press conference yesterday.
Gan added the company had projects in hand and planned with a gross development value (GDV) of RM3.4bil that could offer work and revenue over the next five years.
The RM3.4bil undertakings consist of new launches and ongoing projects in 2023 worth RM1.5bil, as well as projects in the pipeline at the Batu and Petaling districts (to be unveiled in 2024) amounting to RM1.9bil.
“This year, we have projects with a GDV of RM1.5bil to launch. One is at Jalan Ampang with a GDV of RM500mil and the other is at Salak South in Sungai Besi with a GDV of RM1bil. The latter has been quite well-received as we have seen close to 40% of bookings within less than a month of its soft launch,” Gan said.
Radium’s initial public offering (IPO) price of 50 sen per share and an enlarged issued share capital of 3.47 billion shares, gave it a market capitalisation of RM1.7bil.
The company raised RM434mil from the public issue of 868 million new shares. The stock, however, made a soft debut yesterday on the Main Market of Bursa Malaysia opening at 35 sen, which was 15 sen or 30% lower than its offer price of 50 sen.
The shares hit a high of 42 sen and low of 31.5 sen in intraday trading before closing its maiden trading day 11.5 sen or 23% lower at 38.5 sen on weaker market sentiment. The soft debut did not disappoint Gan.
“I think if a business is well prepared, any time is a good time to list the company. Our company has strong fundamentals and the lower opening price just reflects negative market sentiment.
“We remain committed to paying dividends to our shareholders and generating profitability for the group. In the long run, our investors will be able to gain capital returns,” Gan said.
In a filing with Bursa Malaysia yesterday, Radium declared a one-sen single tier interim dividend which is payable on Aug 15.
Radium focuses on competitively priced high-rise residential properties in strategic locations in urban Kuala Lumpur.
The group’s property portfolio comprises condominiums, serviced apartments, suite apartments and Soho units.
About RM171mil of the proceeds raised are earmarked for landbank acquisition and development expenditure. Another RM109.3mil is set aside for the construction of a hotel.
Some RM93.9mil will go towards the repayment of bank borrowings while RM39.8mil is allocated for working capital. The remaining RM20mil will be used to defray listing expenses.
“Our current five-year runway of ongoing and pipeline projects plus the additional IPO proceeds for land banking makes our message very clear: Radium is poised for further growth in the future,” Gan said.
While Radium’s focus is still within the Kuala Lumpur city area for the next five years, Gan does not rule out the possibility of venturing outside of Kuala Lumpur.
“The landbank that we have now, located within Kuala Lumpur, is sufficient to last us for the next five years,” he said.
Located in Ampang, Kuala Lumpur, the hotel, Suite Canselor, is also part of Radium’s ongoing projects. On this note, Radium’s non-independent, non-executive director Datuk Sydney Lim Tau Chin said this is leveraging on the management’s past experience and involvement in the hotel business.
