News & Articles Glomac to ramp up launches following six-year slowdown, its chief said
Glomac to ramp up launches following six-year slowdown, its chief said
22 Oct 2024
KUALA LUMPUR: Glomac Bhd plans to ramp up its annual project launches to RM800 million starting in the financial year ending April 30, 2026 (FY26), according to group managing director and chief executive officer, Datuk Seri FD Iskandar.
Currently, the company launches projects with a gross development value (GDV) of RM400 million annually.
As Glomac celebrates its 35th anniversary, FD Iskandar said that the company is ready to become more aggressive after a six-year slowdown since 2018.
With a landbank exceeding 242 hectares and a potential GDV of over RM7 billion, he believes it's the right time to double the company's annual project launches.
Of the total 242 hectares, around 161.87 hectares are located in the Klang Valley, including its largest plot of 40 hectares in Puchong, with additional land in Rawang, Sungai Buloh, and Subang. In Johor, the company owns 66 hectares in Kulai and Ulu Tiram.
"If we still launch a project with a GDV of RM400 million a year, it will take 17 to 18 years to finish (the landbank). With the launch of RM700 million GDV, it may take less than 10 years to be completely exhausted.
"So I want to speed up our property launches instead of waiting to finish them. The year after, maybe we can increase it up to RM1 billion," he told Business Times.
In the current financial year ending April 30, 2025 (FY25), Glomac aims to launch properties worth RM459 million, including Serai@SBCR Phase 1 in Sungai Buloh, Saujana KLIA, and Saujana Jaya in Kulai.
Recent projects include semi-detached residential units at Keys in Lakeside Residences, Puchong, and shop offices at Saujana Perdana.
Upcoming launches include terrace houses at Saujana Utama (Serai@SBCR) and Loop Residences service apartments in Puchong.
Regarding Glomac's recently announced RM3 billion sukuk wakalah programme, Iskandar explained that the funds will enable the company to seize future opportunities and avoid missed chances due to a lack of capital, as happened previously.
"Many people ask why a mid-sized company like Glomac wants to issue RM3 billion sukuk. We want to be ready when there is opportunity.
"I had missed two opportunities previously due to the lack of funds; hence, I don't want it to happen again," he said.
Additionally, FD Iskandar said the funds will also be used to pay off some debts, particularly those with an interest rate of 5.5 per cent.
He stated that around 30 and 35 per cent of the proceeds from the sukuk are allocated to reduce debt, while the remaining 60 to 65 per cent will be used to acquire land in strategic areas.
As of July 31, 2024, the group has a net gearing of 0.06 times against shareholders' funds of RM1.25 billion, while cash and deposits amount to RM292.4 million compared to short-term loans of RM237 million.
FD Iskandar added that the company is also looking at diversifying into areas that have synergies with its core business in property development, such as green energy, that require huge investment.
"For a company to enter the green energy business, RM500-600 million is not enough. At least we have enough capital (through Sukuk) to grab an opportunity," he added.
Currently, the company launches projects with a gross development value (GDV) of RM400 million annually.
As Glomac celebrates its 35th anniversary, FD Iskandar said that the company is ready to become more aggressive after a six-year slowdown since 2018.
With a landbank exceeding 242 hectares and a potential GDV of over RM7 billion, he believes it's the right time to double the company's annual project launches.
Of the total 242 hectares, around 161.87 hectares are located in the Klang Valley, including its largest plot of 40 hectares in Puchong, with additional land in Rawang, Sungai Buloh, and Subang. In Johor, the company owns 66 hectares in Kulai and Ulu Tiram.
"If we still launch a project with a GDV of RM400 million a year, it will take 17 to 18 years to finish (the landbank). With the launch of RM700 million GDV, it may take less than 10 years to be completely exhausted.
"So I want to speed up our property launches instead of waiting to finish them. The year after, maybe we can increase it up to RM1 billion," he told Business Times.
In the current financial year ending April 30, 2025 (FY25), Glomac aims to launch properties worth RM459 million, including Serai@SBCR Phase 1 in Sungai Buloh, Saujana KLIA, and Saujana Jaya in Kulai.
Recent projects include semi-detached residential units at Keys in Lakeside Residences, Puchong, and shop offices at Saujana Perdana.
Upcoming launches include terrace houses at Saujana Utama (Serai@SBCR) and Loop Residences service apartments in Puchong.
Regarding Glomac's recently announced RM3 billion sukuk wakalah programme, Iskandar explained that the funds will enable the company to seize future opportunities and avoid missed chances due to a lack of capital, as happened previously.
"Many people ask why a mid-sized company like Glomac wants to issue RM3 billion sukuk. We want to be ready when there is opportunity.
"I had missed two opportunities previously due to the lack of funds; hence, I don't want it to happen again," he said.
Additionally, FD Iskandar said the funds will also be used to pay off some debts, particularly those with an interest rate of 5.5 per cent.
He stated that around 30 and 35 per cent of the proceeds from the sukuk are allocated to reduce debt, while the remaining 60 to 65 per cent will be used to acquire land in strategic areas.
As of July 31, 2024, the group has a net gearing of 0.06 times against shareholders' funds of RM1.25 billion, while cash and deposits amount to RM292.4 million compared to short-term loans of RM237 million.
FD Iskandar added that the company is also looking at diversifying into areas that have synergies with its core business in property development, such as green energy, that require huge investment.
"For a company to enter the green energy business, RM500-600 million is not enough. At least we have enough capital (through Sukuk) to grab an opportunity," he added.
Source: NST.com.my