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Tuesday January 29, 2008

Sri Kembangan project to drive LBI Capital


SHAH ALAM: LBI Capital expects its commercial development in Sri Kembangan to be its main revenue contributor for the financial year ending Dec 31, 2008. 

Managing director Datuk Jeffrey Ng Chin Heng expressed confidence in the project comprising 100 units of two- and three- storey shoplots in Taman Pinggiran Putra in Sri Kembangan, which have a gross development value (GDV) of RM80mil.  

“This project has been well received and has achieved 85% take-up since it was launched at the end of last year,” he said after the company EGM yesterday. 

Ng said the company planned to launch by year-end an industrial park on 36 acres in Puchong Perdana with a potential GDV of RM70mil.  

“This project would cater to small and medium industries such as freight forwarders looking for semi-detached industrial lots of about 5,000 sq ft each,” Ng said. 

The company is also involved in three projects launched last year. One is a mixed development project in Taman Mewah, Johor Baru. 

“The first phase, which consists of shop apartments launched six months ago, is 50% sold,” Ng said, adding that the project also offered two-storey shop offices and terrace houses. Other noted developments are the 65 bungalows in Sri Kembangan with a GDV of RM55mil and 75 terrace houses in Sri Gombak with a GDV of RM23mil. 

Ng said the company targeted to grow its landbank in Selangor and would like to be involved in high-end projects such as luxury homes as part of its portfolio.  

“In view of rising building material costs, low-medium and medium-cost projects do not provide attractive profit margins compared with luxury developments,” he said.  

Property development contributes 95% to revenue for LBI Capital, which is also involved in manufacturing rubber products and trading.  

“Rubber manufacturing has become less lucrative over the years due to competition from bigger markets like China and increased manufacturing costs locally,” Ng said, adding that the company would consider divesting this division if there were offers. 

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