KUALA LUMPUR: Bina Puri Holdings Bhd plans to list its Indonesian power assets, possibly as early as next year, said group executive director Matthew Tee Kai Woon.
“It’s too early to talk about the details of the listing yet, but it will be on the Development Market, which is a similar version of the ACE Market [of Bursa Malaysia],” he told a news conference yesterday.
“We’re also thinking if we should wait for our mini hydro plant [there] to be completed as the [initial public offering] valuation could be higher [with its inclusion],” he said.
The group has seven micro
diesel-generated power plants across Indonesia, with a total capacity of 25MW. Its hydro-power project is located in Sulawesi Selatan and construction was 62% complete as at September this year.
Tee also said Bina Puri has lined up property launches with a total gross development value (GDV) of RM3 billion over the next four years, as part of efforts to raise the profit margin contribution from its property development business.
“The gross margin for listed construction companies is only about 8%, and goes down to between 4% and 5% after tax. We definitely have to look for ways to improve this, and we have noticed that when it comes to property development, we can register a minimum margin of about 15%,” he said.
The launches will mostly be residential projects in Peninsular Malaysia, Sabah and Sarawak. The group’s upcoming projects include Petrie Villa in Johor Baru with a GDV of RM114.4 million, Opus Service Residences in Kuala Lumpur (RM348.5 million) and the RM66.8 million Jesselton View in Kota Kinabalu.
On its construction business, Tee said the group is expected to be the beneficiary of the government’s entry point projects going forward.
“We will be tendering for the West Coast Expressway (WCE), Kinrara-Damansara Expressway (Kidex) and the Pan Borneo Highway projects. Being one of the major contractors in Malaysia, one way or another we will be invited to tender for it,” he said, adding that Bina Puri will put in its tenders as a standalone contractor.
Currently, the group’s total ongoing projects are worth RM3.7 billion, with an outstanding order book of RM2.01 billion.
On the issues surrounding its construction of klia2 in Sepang and the issuance of the certificate of practical completion (CPC), the group’s chief operating officer for contracts and administration We Her Ching said Bina Puri is still having discussions with airport operator Malaysia Airports Holdings Bhd (MAHB).
“Physical works [of klia2] have been completed ... This is more on the documentation side, and it’s something we need to sort out with MAHB,” he said, referring to the reasons why MAHB had not issued the CPC as there are material contractual obligations still outstanding with the new low-cost carrier terminal.
The CPC is a certificate issued contractually by MAHB when work has been completed to its satisfaction and meets all contract requirements. Bina Puri shares closed one sen or 1.67% higher yesterday at 61 sen, with a market capitalisation of RM108.53 million.
This article first appeared in The Edge Financial Daily, on November 20, 2014.