Plenitude to unveil more properties

B U S I N E S S

Saturday March 31, 2007

Plenitude to unveil more properties

By Yeow Pooi Ling

Elsie Chua with a model of the Taman Desa Tebrau project in Johor.
KUALA LUMPUR: Plenitude Bhd will be kept busy from the second half of the year as it plans several property launches.

By the fourth quarter, it intends to launch Lot 88 in Sungai Petani, which has a gross development value of RM128mil.

Executive chairman Elsie Chua said by next year's second quarter, the company was set to launch The Batai at Damansara Heights and Ferringhi Heights in Penang, which respectively covered 3.5 acres and 10.6 acres.

While noting that the property market had been soft, she said it was likely to recover in the second half of the year, especially given the recent liberalisations by the Government.

The abolishment of real property tax gains, for example, was anticipated to attract more purchasers as it provided more options and greater flexibility, Chua said in an interview.

Plenitude was also one of the beneficiaries for incentives under the Iskandar Development Region (IDR), as its Taman Desa Tebrau project in Johor formed part of the IDR, she added.

For the year ending June 30, 2007, earnings are likely to be buoyed by Tebrau City, which is within the Taman Desa Tebrau development, according to Chua.

Two out of eight serviced apartment blocks were launched last year and so far, about half the units had been taken up, Chua said, adding that the other blocks would be launched in phases next year.

The mixed development was also expected to benefit from the proposed monorail project in Johor, which would have a stop at Tebrau City, she said.

Besides the 1,088 serviced apartment units, it will also have 400,000 sq ft of retail and commercial space for leasing. Presently, Tebrau City houses the largest Jusco department store in the country.

Hypermarket Tesco is also anticipated to open within Tebrau City, given that it had signed a leasing agreement with Plenitude last year.

It would look at buying more land in Johor. “We're in a strategic position, given our strong cashflow. We're not in a rush to increase our land bank as the existing land will sustain us for 10 to 15 years,” Chua said.

OSK Securities said Plenitude made a strategic move in deferring some of its launches at Taman Desa Tebrau, as it would be able to capture larger profits from the fast growing property region in Johor.

“It will also inevitably compromise earnings expectations in the nearer term,” the brokerage said.

Given Plenitude's strong cashpile of RM36.4mil as at Dec 31, 2006, the company could afford to defer the launches for richer value creation in the longer term, it added.

Its shares were actively traded yesterday. The counter closed up 13 sen at RM2.20, which is still below its net tangible assets of RM3.58 per share. OSK estimated its revised net asset value at RM4.24 per share.


PLENITU : [Stock Watch] [News]

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