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Monday, 8 May 2017

(The Star) Inta Bina counts on affordable housing projects

PETALING JAYA: Building contractor Inta Bina Group Bhd will be banking on more affordable housing projects in the next two years to propel its next stage of growth.

With major property developers shifting towards the affordable housing space, managing director Paul Lim Ooi Joo said this would be Inta Bina’s focus until the housing market gained momentum.

Inta Bina has more than 25 years experience as a building contractor in Malaysia and has been the main contractor for various residential, commercial, industrial and leisure properties.

It launched its prospectus last Friday and is en route to list on the ACE Market of Bursa Malaysia by the second quarter of this year.

Lim said the company expected to raise RM26.76mil from its initial public offering (IPO) exercise.

“In a slow real estate market and with property developers making a shift towards affordable homes, we see this as an opportunity.

“More so since our strategy to constructing affordable homes is via the usage of aluminium system formwork, as this is best suited for these projects and will improve our cost competitiveness in the long run,” Lim said, adding that it would reduce labour cost and cut construction period.

At present, Inta Bina has one affordable housing project, Eco Majestic in Semenyih, worth RM89.41mil under Eco World Development Group Bhd.

Of the total IPO proceeds, RM9mil or 33.63% will be used to repay bank borrowings, RM5mil (18.68%) for capital expenditure to buy various machinery and equipment.

A total of RM9.56mil (35.73%), meanwhile, will be tranched out for general working capital requirements to finance Inta Bina’s daily operations for its ongoing and future projects, while the remaining RM3.20mil to be used to defray listing expenses for the IPO.

Inta Bina is currently the main contractor for 14 ongoing projects in the Klang Valley and Johor.

Its unbilled order book as at March 31, 2017 stood at RM486.16mil that would keep the company busy till early 2019.

The company has tendered for nine residential and non-residential projects worth RM434.05mil in the Klang Valley and Johor early this year.

“The outlook for the construction industry is positive in the immediate term and steady growth is projected throughout the forecast period from 2017 to 2021,” noted Lim.

Inta Bina profit after tax rose 10.6% to RM12.73mil for the financial year 2016, from RM11.51mil, a year ago. This was against a lower revenue of RM257.14mil from RM271.94mil previously.

As at Dec 31, 2016, its cash and cash equivalents stood at RM30.4mil, of which RM25.2mil were short-term deposits with licensed banks, and cash and bank balance of RM5.2mil.

Inta Bina’s IPO entails the issuance of 107.05 million new shares at 25 sen per share. A total of 53.53 million new shares has been reserved for private placement to bumiputra investors, while 26.76 million is for the public.