KUALA LUMPUR: Mah Sing Group Bhd, the country's second-largest property developer by sales value, expects sales to pick up in the second half of 2015 (2H15), after a slow 1H15 which saw RM761 million worth of property sold in the first four months.

The figure represented only 22% of the RM3.43 billion achieved for the whole of last year.

Mah Sing executive director of corporate and investment Datuk Steven Ng Poh Seng said the developer is hoping that stronger demand in the affordable housing segment would mitigate the weaker sentiment in the overall property market.

“We recorded sales of RM761 million for the first four months of this year, with RM560 million earned in the first quarter ended March 31, 2015 (1Q15). We hope to see stronger sales momentum in the second half,” he told reporters after Mah Sing’s annual general meeting here yesterday.

Nevertheless, Poh Seng said it is still too early to consider revising downwards the group's sales target of RM3.43 billion for the full year, in which it has targeted to replicate its achievement in 2014.

“Right now, it’s a bit premature … although we did not achieve our first-quarter sales target, once momentum picks up and with the launches we have planned in line in the second half, that should allow us to catch up [on our target],” he said.

Poh Seng added that the slow 1Q15 sales are also attributable to fewer working days in the period, owing to festivities, along with weak consumer sentiment in the property sector due to the implementation of the goods and services tax (GST) on April 1, the weaker ringgit and low commodity prices.

“Unfortunately, we have the GST in the second quarter, which impacted house buyers ... we are actually going through an adjustment period of about six to nine months, but we hope for sales to pick up in the second half,” he said, adding that Mah Sing had unbilled sales of RM5.1 billion as of March 31, 2015.

Poh Seng is of the view that prices of affordable homes — which will be Mah Sing’s focus moving forward — will hold steady as demand in this segment remains strong.

This year, Mah Sing plans for 44% of its residential launches to be priced below RM500,000, 71% to be priced below RM700,000 and 84% to be priced below RM1 million.

Mah Sing chief executive officer Ng Chai Yong said to ease the impact of slower demand in 1H15, the group has deferred some launches planned for 1H15 to 2H15.

“We will launch some blocks of property in the later part of the year to make sure they are well received,” he said.

Meanwhile, Poh Seng said Mah Sing is still keen on making a foray into Negeri Sembilan by undertaking a township development with a gross development value of RM7.5 billion, despite a new housing policy which, among others, includes the raising of the bumiputera quota from 30% to 50% there.

In August last year, Mah Sing announced that it was buying a 425.3ha piece of land in Rantau for RM359.56 million.

Mah Sing (fundamental: 2.8; valuation: 2.4) shares closed up 0.59% at RM1.71 yesterday, with a market capitalisation of RM4.13 billion.

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This article first appeared in The Edge Financial Daily, on June 19, 2015.