Friday 29 Mar 2024
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KUALA LUMPUR (Jan 20): Encorp Bhd has entered into a memorandum of agreement (MoA) with the Federal Land Development Authority (Felda) to nominate its unit Encorp Bukit Katil Sdn Bhd as the master developer for Felda's integrated township in Bukit Katil, Melaka, which carries a gross development value (GDV) of RM3.2 billion.

Felda and Encorp chairman Tan Sri Mohd Isa Abdul Samad said the 640.98-acre township will be launched in phases, with construction to commence early 2017, after getting the necessary approvals.

"We expect to complete the development within 14 years. We announced a higher GDV of RM4.9 billion in 2015, but considering the dampened property segment, the GDV has been revised down to RM3.2 billion," he told the media at a press conference today, following the signing of the agreement between the parties.

Mohd Isa said the project will be developed in three phases, with each phase to take about two to three years to complete. He said the timeline for the phases will depend on how the property market is doing.

"If the property market looks good, we might expedite development of the project. But for now, the market seems sluggish. We are flexible. We will adjust according to how the market does in the future," he said.

He added that a minimum return on investment of 18% is expected from the project.

The mixed township development will comprise residential, commercial projects and public amenities at Bukit Katil, Melaka.

To recap, Felda had acquired a majority stake in Encorp in 2014, using the latter as a property development vehicle to develop Felda's large landbank.

According to Bursa filings, Felda has an indirect interest of 197.49 million shares, equivalent to 72.27% in Encorp, via its investment arm Felda Investment Corp Sdn Bhd.

Encorp shares fell 2 sen or 2.6% to 75 sen at 2.55pm, translating to a market capitalisation of RM214.3 million.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)

 

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