Monday, July 21, 2014

I-Bhd ... Focus On Property Development & Recurring Income

The master developer of i-City, a 72 acre urban development in Shah Alam is long for its next project as it gears up to reach a market cap of rm1 billion with a series of corporate exercise.

It will look beyond Shah Alam. Any project the group takes on after i-City will still be in the area of urban development as I-Bhd is establishing itself as an urban developer via i-City.

Once the corporate exercise is completed, it will be a rm1 billion market cap company. It is positioning for I-Bhd to go beyond i-City. In Dec 2013, it announced a series of corporate exercises including a share split, rights and bonus issue, as well as the issuance of both RCULS and ICULS raising rm702 million.

The sum will mainly fund I-Bhd’s investment property portfolio.

The rm502 million raised will be used to acquire two parcels of land in i-City for the Soho and Central Tower developments respectively as well as one parcel on Jalan Changkat Kia Peng. Meanwhile rm200 million raised from the rights issue will be used to fund I-Bhd shopping mall venture and other property development activities in i-City.

The corporate exercise will boost liquidity and increase its public shareholding spread. Currently (July 2014), executive chairman Tan Sri Lim Kim Hong holds some 75% of the company indirectly.

Assuming full conversion of the ICULS and RCULS, Lim’s shareholding will be reduced to 60%.

Its JEWEL is a mixed residential, hospitality and office project in i-City with a GDV of rm2 billion which is the final phase of i-City.

It expects its property development to double 2013’s revenue to rm95 million…

Its unbilled sales is about rm400 million.

For FY2014, it will launch developments with GDV of rm1.6 billion …. Rm820 million Grand Residence project on the Kia Peng land in the KLCC area and three towers in the i-Suite development in i-City.

The property development segment will remain a major contributor. The group is ramping up its property investment portfolio and leisure segments so that when the whole i-City development is completed it will still be able to generating recurring income from the two segments.

The property investment portfolio, comprising car parks and a date centre was valued at rm74 million. This will increase to rm1 billion upon opening of two i-City properties along with 65000 new car parks.

Currently (July 2014), most of the growth comes from more ticket sales per visitor rather than growth in visitors.

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Please note that all data given are merely blogger's opinion. It is strongly recommended that you do your own analysis and research before investing.