Development of eco-city in Penang to benefit Aspen

Development of eco-city in Penang to benefit Aspen

By: 
Samantha Chiew
19/09/17, 04:07 pm

SINGAPORE (Sept 19): OCBC likes developer Aspen for its ongoing property projects which are expected to contribute to an improvement of its development income.

According to lead analyst Carmen Lee in a Monday unrated report, this will be apparent as takeup rates rise and companies shift their operations to Penang, Malaysia.

OCBC says the bulk of the group’s projects are located at the Batu Kawan area, Penang’s third satellite city which is currently being developed into an eco-city with university, shopping, medical centre and other facilities plus direct access to both the North-South Highway as well as Penang’s second bridge.

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One of the group’s mega development project is Aspen Vision City (AVC), a 245-acre freehold mixed development project at Batu Kawan. The first Ikea store in the Northern region of Peninsular Malaysia which is slated to operate in 1Q19 will also be housed in AVC.

Aspen listed on the Singapore Exchange on July 28.

See: Aspen launches IPO at 23 cents per share

According to information from the listing prospectus, the gross development value for AVC is about RM11.9 billion ($3.8 billion).

Currently, the group has already launched Vervea, a commercial and retail development and Vertu Resort, a residential development with a gross development value (GDV) of RM845.2 million and RM662 million respectively.

In addition, the group is starting to see positive results as it posted net earnings of RM13.4 million in 2Q17 compared to a loss of RM751,000 in 2Q16.

The stronger bottomline came on the back of a 246% y-o-y jump in revenue to RM70 million due to advanced progress from the Tri Pinnacle and Vervea projects.

“It has also recently announced an annual dividend payout policy of not less than 20% of profits,” says Lee.

As at 3.33pm, shares in Aspen are trading at 23 cents.

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