I-Berhad
I-BERHAD’S recently completed fundraising exercise heralds busier times, which will underpin growth going forward.

The rights issue raised RM197.5 million while the detachable warrants could raise another RM96.7 million if fully converted. Two-third of the monies are allocated for property development with the balance for a shopping mall joint venture (JV). The company also acquired several pieces of land, worth some RM502.3 million, partially paid with RCULS and ICULS.

To recap, I-Berhad entered into a JV with Thailand’s largest retail developer Central Pattana PCL last year to develop the RM580 million CentralPlaza@i-City regional retail mall. The mall, to be completed in 2017, has about 1 million sq ft of net lettable area.

Elsewhere, it is teaming up with Best Western International to build a 216-room hotel in i-City and 826 units of serviced apartments, i-Suite@i-City in Shah Alam. The RM50 million hotel is slated to open in 3Q14 while the RM500 million i-Suites will be completed by 2017.

I-Berhad is the master planner of i-City, a 72-acre freehold land in Section 7, Shah Alam – with an estimated GDV of RM7 billion. It also has 1.05 acres of land in the vicinity of KLCC. Dubbed Grand i-Residence, the project comprises a 50-storey luxury condominium with estimated GDV of RM820 million.

Unbilled sales stood at RM400 million with RM1.6 billion launches planned by end-2014. I-Berhad expect annual sales to more than triple to RM500-600 million within  three years. Once i-City is fully developed, I-Berhad expects to derive 50% of earnings from recurring income, namely from leisure and property investments, and the balance from development.

The stock is trading at a trailing 12-month P/E of 7.3 times and 0.9 times book value. Dividend totalled 1.0 sen (adjusted for rights issue) per share in FY2013, translating into a yield of 1.3%.

This article first appeared in The Edge Financial Daily, on November 24, 2014.