not vested
L&G on course to RM500mil market cap BY LIZ LEE
KUALA LUMPUR: Land & General Bhd (L&G)’s aim of becoming a mid to large-tier property player is near realisation as the group believes it could exceed the RM500mil market capitalisation mark before the year-end or early 2015.
The bump up has long been a goal of the company whose current market cap is RM379mil. When the current management took over six years ago, L&G’s market cap was only about RM150mil.
At that point, the group was RM200mil in debt, but since its restructuring L&G now has a gearing of 0.04 times.
The management believes that its irredeemable convertible unsecured loan stocks issued in September last year will boost the group’s market cap in time.
Managing director Low Gay Teck said that with the two sen dividend payout declared, equivalent to more than 30% of the net profit attributable to owners of the company, shareholders would likely convert all the loan stocks at 13 sen apiece to mother shares.
The dividend payout was L&G’s first since the 1990s. There is no dividend policy yet.
The group was also looking to raise its borrowings for land and project acquisitions.
“We have cash reserves of RM300mil currently but this won’t be solely for acquisitions. For new projects, we will borrow to finance our growth,” Low said at a company update and presentation of the audited results for the 2014 fiscal year.
Meanwhile, the group has three launches planned for the first quarter of 2015, on the back of a bullish property market outlook next year.
Within the next 12 months, it plans to roll out properties worth RM2bil in gross development value (GDV). The projects are the Elements2 serviced apartments in Jalan Ampang, Damansara Foresta Phase 2 apartments in Bandar Sri Damansara and its upmarket residential township Tuanku Jaafar Resort Homes in Seremban.
Low said the group hoped to firm up next year the layout plans for its 2,500-acre palm oil and rubber plantation, Ladang Sungai Jernih in Lembah Beringin.
The estimated GDV for this massive development is RM100bil, to include residential, commercial and leisure components like themed parks.
“We believe this will be our multi-year revenue generator when it is launched because it is close to the Perak Iskandar region and many other surrounding developments,” he said.
Source: The Star