Tuesday, January 23rd, 2018

 

Savills: 27 new malls to enter Greater KL market by 2021

KUALA LUMPUR: Property consultancy firm Savills (Malaysia) Sdn Bhd expects the retail space market to remain challenging with 27 new malls anticipated to enter the market in Greater Kuala Lumpur (KL) by 2021.

Speaking at the 11th Malaysian Property Summit 2018 (11MPS) today, Savills deputy executive chairman Allan Soo said the firm estimates that Greater KL will have 197 malls in the next three years, with a total of 86.2 million sq ft retail space, from 170 malls currently with a total of 62 million sq ft retail space in the market.

This year alone, National Property Information Centre (Napic) reported, there will be an additional supply of about 20 million sq ft of shopping complexes and 22 million sq ft of purpose-built office (PBO) in the market.

The additional space will definitely increase the total supply available in both sectors which may result in lower occupancy rates if not supported by market demand.

Nevertheless, Soo noted that the average occupancy rate of retail space in the Greater KL stood at 87.9% as of end-2017, which he said is “not that alarming”.

Soo cited Suria KLCC, Pavilion KL, Mid Valley Megamall, Sunway Pyramid and 1Utama Shopping Centre as examples of the top performing malls in Greater KL, with an occupancy rate of more than 90% for each mall.

According to him, the incoming megamalls in the region include The Exchange Mall, Mitsui Shopping Park Lalaport, Merdeka PNB118 mall, Pavilion Damansara Heights, Pavilion Bukit Jalil, Tropicana Gardens Mall, CentralPlaza mall and Empire City mall.

Commenting on the transformative effect of e-commerce on the retail industry, Soo said the retail market will experience a changing landscape in the longer term, as malls react to the millennium crowd and e-commerce’s disruptions.

Knight Frank Malaysia Sdn Bhd managing director Sarkunan Subramaniam said he expects the Klang Valley office market to become even more competitive with the additional space of 22 million sq ft of PBO anticipated to enter the market this year.

“There will be more pressure on rent,” he said, noting that the office occupancy rate and average rental in Klang Valley are expected to continue their downtrend this year.

Asked whether the government’s move to freeze approvals of new applications to build shopping centres, offices, serviced apartments and luxury condominiums in the city centre is sufficient to reduce the oversupply of properties in the market, Sarkunan said “there is no reason for a freeze”.

“The freeze is totally unwarranted. Let the market dictate through lending and financing,” he added.

The annual property summit was organised by the Association of Valuers, Property Managers, Estate Agents and Property Consultants in the Private Sector Malaysia.


Construction of affordable housing units in Klang Valley running far below target

KUALA LUMPUR: The affordable housing project in Klang Valley is lagging far behind its 606,000 units target under the 11th Malaysia Plan (11MP), with only about 45,000 units of the homes completed currently.

“From what we have seen today, less than 50,000 units have been completed. We are far away behind from the target,” CBRE WTW managing director Foo Gee Jen said at the 11th Malaysian Property Summit 2018 today.

In November last year, the government said it had completed the construction of a total of 255,341 affordable homes since 2013, which was far from reaching its target of 1.1 million units by the end of this year.

In the last three years, Foo said, government agencies have come up with several affordable housing programmes, such as PR1MA, Rumah Selangorku, Federal Territories Housing Scheme, Program Perumahan Rakyat, Perumah Penjawat Awam 1 Malaysia, Rumah Mesra Rakyat 1 Malaysia and Rumah Idaman Rakyat.

He concluded his presentation by pointing out several ways that could be reflected in affordable housing policy including: providing more incentives for private developers, co-sharing infrastructure costs, centralising policy-making and delivery of affordable housing to eliminate hidden costs, simplifying application procedures and creating a one-stop data centre to provide information on the market.


DRB-Hicom’s Proton slams brakes on joint venture with Lotus, Goldstar

PETALING JAYA: DRB-Hicom Bhd’s 50.1% owned subsidiary Proton Holdings Bhd has dissolved its joint venture partnership with Lotus Group International Ltd and Goldstar Heavy Industrial Co Ltd, formed to sell and produce Lotus branded vehicles, components, parts and accessories in China, following delays in obtaining a manufacturing licence.

The group’s board of directors said in a Bursa Malaysia filing, it had terminated its Equity Joint Venture Contract (EJV) with Goldstar and Lotus after its EJV company (EJVC) Goldstar Lotus Automobile Co Ltd (GLAC) failed to obtain a manufacturing licence within the stipulated time frame.

GLAC has not commenced its business operations in the absence of a manufacturing licence.

The initial deadline to obtain the licence was set for Sept 25, 2017 but was subsequently extended to Dec 31, 2017.

“Arising from the termination, the parties will consider and agree on the next course of action under the EJVC and in accordance with the laws of the People’s Republic of China,” the group’s board said on the fate of GLAC.

The two parties had entered into a EJVC on April 17, 2015 and the EJVC company was formed on Sept 25, 2015, to produce and sell Lotus branded passenger cars, engines, parts and components, and accessories and to provide after sales services including spare parts.

The amount of issued and paid-up share capital of GLAC is 180 million yuan (RM110.3 million).

Proton held a 40% stake in GLAC, while Lotus held 10%. The remaining 50% was held by Goldstar.

The termination of partnership is not expected to have material impact on the group’s earnings for the financial year ending March 31, 2018.

DRB-Hicom’s shares gained 10.98% to close at RM2.73 with some 24.83million shares done.


DRB-Hicom slams brakes on joint venture with Lotus, Goldstar

PETALING JAYA: DRB-Hicom Bhd’s 50.1% owned subsidiary Proton Holdings Bhd has dissolved its joint venture partnership with Lotus Group International Ltd and Goldstar Heavy Industrial Co Ltd, formed to sell and produce Lotus branded vehicles, components, parts and accessories in China, following delays in obtaining a manufacturing licence.

The group’s board of directors said in a Bursa Malaysia filing, it had terminated its Equity Joint Venture Contract (EJV) with Goldstar and Lotus after its EJV company (EJVC) Goldstar Lotus Automobile Co Ltd (GLAC) failed to obtain a manufacturing licence within the stipulated time frame.

GLAC has not commenced its business operations in the absence of a manufacturing licence.

The initial deadline to obtain the licence was set for Sept 25, 2017 but was subsequently extended to Dec 31, 2017.

“Arising from the termination, the parties will consider and agree on the next course of action under the EJVC and in accordance with the laws of the People’s Republic of China,” the group’s board said on the fate of GLAC.

The two parties had entered into a EJVC on April 17, 2015 and the EJVC company was formed on Sept 25, 2015, to produce and sell Lotus branded passenger cars, engines, parts and components, and accessories and to provide after sales services including spare parts.

The amount of issued and paid-up share capital of GLAC is 180 million yuan (RM110.3 million).

Proton held a 40% stake in GLAC, while Lotus held 10%. The remaining 50% was held by Goldstar.

The termination of partnership is not expected to have material impact on the group’s earnings for the financial year ending March 31, 2018.

DRB-Hicom’s shares gained 10.98% to close at RM2.73 with some 24.83million shares done.


Samchem mulls listing Vietnamese unit

KUALA LUMPUR: Industrial chemicals distributor Samchem Holdings Bhd (Samchem) is exploring the possibility of listing its Vietnam unit, Samchem Sphere JSC (Samchem Sphere) on the Ho Chi Minh Stock Exchange to capitalise on the country’s fast-growing economy.

“The proposed listing will enable Samchem to capitalise on the fast-growing Vietnamese economy and the potential growth of the industrial chemical sector in Vietnam,” it said in a filing to Bursa Malaysia today.

It would also provide a platform for Samchem Sphere to obtain a listing status, and gain direct access to the Vietnamese capital market to raise funds for its future expansion and continued growth without having to rely on Samchem’s existing resources, it added.

Samchem said the proposed listing would enhance Samchem Sphere’s profile and increase its visibility to customers, suppliers, business associates and investors in Vietnam.

A corporate adviser licensed in Vietnam has been appointed to evaluate and advise on the proposed listing of the company. – Bernama


UAE firm in deal to supply naptha to Lotte Chemical Titan

PETALING JAYA: Lotte Chemical Titan Holding Bhd’s wholly owned subsidiary Lotte Chemical Titan (M) Sdn Bhd has entered into a three-year sales contract with United Arab Emirates-based Abu Dhabi National Oil Co (ADNOC) for the supply of refined products and paraffinic naphtha.

The group announced in a stock exchange filing that the contract runs from Jan 1, 2018 to Dec 31, 2020.

Pricing of the supplies will be based on the market price of the commodity during the loading month. The estimated quantity is between 600,000 tonnes and 1 million tonnes a year.

ADNOC is a major feedstock supplier of naphtha to Lotte and had previously supplied the commodity in a one-year contract.

Lotte’s shares gained 0.39% to close at RM5.18 with some 731,300 shares done.


Malaysian Automotive Association bullish on NAP 2018

PETALING JAYA: The Malaysian Automotive Association (MAA) is hoping that the review of the National Automotive Policy (NAP), which will be announced by the government in mid-2018, will improve the automotive industry and help boost vehicle sales.

MAA president Datuk Aishah Ahmad said the government has not engaged with MAA on the review of the NAP and that the details of the NAP 2018 have not been discussed with the industry.

“It’s just preliminary announcement that there are some changes in the NAP and we hope whatever announcements they make will be good for the industry and will boost industry sales and assist the industry for us to expand sales and make more money,” she told a press conference on the automotive market review for 2017 and outlook for 2018 today.

Last week, International Trade and Industry Minister Datuk Seri Mustapa Mohamed said NAP 2018 is still a work-in-progress, with consultations to continue for another four to five months. NAP 2018 will focus on mobility, next-generation vehicles, big data, lifestyle and connectivity.

With NAP 2018 also focusing on parts and components, Aishah concurred that this is a growth area based on industry figures.

She said NAP 2014 has helped reduce the prices of energy-efficient vehicles (EEV) slightly as EEV producers enjoyed incentives on local components.

Meanwhile she said the strengthening ringgit will help industry players, especially those who trade in US dollars and Japanese yen, as they will have better margins.

MAA is projecting a total industry volume (TIV) of 590,000 units in 2018, a 2.3% growth from 2017. This takes into account of factors like economic growth, rising cost of doing business, rising cost of living, continuation of the strict lending guidelines and ride-hailing services.

The TIV of new motor vehicles registered in 2017 declined marginally by 0.6% to 576,635 units in 2017 from 580,085 units in 2016.

Aishah said the local automotive market was subdued for much of last year.

For the second consecutive year, the TIV contracted, reflecting perhaps a down-cycle of the market that started in 2016.

“Despite our country’s economic recovery and the aggressive promotional campaigns undertaken by MAA members, sales remained essentially flat in 2017. This can be attributed to the inflationary pressures affecting consumers’ disposable income, which consequently resulted in cautious consumer spending,” said Aishah.


MAA bullish on NAP 2018

PETALING JAYA: The Malaysian Automotive Association (MAA) is hoping that the review of the National Automotive Policy (NAP), which will be announced by the government in mid-2018, will improve the automotive industry and help boost vehicle sales.

MAA president Datuk Aishah Ahmad said the government has not engaged with MAA on the review of the NAP and that the details of the NAP 2018 have not been discussed with the industry.

“It’s just preliminary announcement that there are some changes in the NAP and we hope whatever announcements they make will be good for the industry and will boost industry sales and assist the industry for us to expand sales and make more money,” she told a press conference on the automotive market review for 2017 and outlook for 2018 today.

Last week, International Trade and Industry Minister Datuk Seri Mustapa Mohamed said NAP 2018 is still a work-in-progress, with consultations to continue for another four to five months. NAP 2018 will focus on mobility, next-generation vehicles, big data, lifestyle and connectivity.

With NAP 2018 also focusing on parts and components, Aishah concurred that this is a growth area based on industry figures.

She said NAP 2014 has helped reduce the prices of energy-efficient vehicles (EEV) slightly as EEV producers enjoyed incentives on local components.

Meanwhile she said the strengthening ringgit will help industry players, especially those who trade in US dollars and Japanese yen, as they will have better margins.

MAA is projecting a total industry volume (TIV) of 590,000 units in 2018, a 2.3% growth from 2017. This takes into account of factors like economic growth, rising cost of doing business, rising cost of living, continuation of the strict lending guidelines and ride-hailing services.

The TIV of new motor vehicles registered in 2017 declined marginally by 0.6% to 576,635 units in 2017 from 580,085 units in 2016.

Aishah said the local automotive market was subdued for much of last year.

For the second consecutive year, the TIV contracted, reflecting perhaps a down-cycle of the market that started in 2016.

“Despite our country’s economic recovery and the aggressive promotional campaigns undertaken by MAA members, sales remained essentially flat in 2017. This can be attributed to the inflationary pressures affecting consumers’ disposable income, which consequently resulted in cautious consumer spending,” said Aishah.


Digi.Com Q4 net profit marginally lower

PETALING JAYA: Digi.Com Bhd saw fourth quarter net profit for the quarter ended Dec 31, 2017 come in marginally lower at RM360.1 million due to slightly lower service revenue, an almost doubling of finance costs from adverse fair value changes of interest rate swaps of RM25 million and settlement costs and exit of RM6 million for the termination of IT infrastructure with Telenor companies.

For the fourth quarter ended Dec 31, 2016, the group made a net profit of RM374.6 million.

This was on revenue of RM1.6 billion for the quarter under review, compared with RM1.7 billion for the same quarter in 2016.

Digi.com has announced an interim dividend of 4.6 sen for the quarter, bringing total dividend payout to 18.99 sen for the year, compared with 21 sen in 2016.

Net profit for the 12-month period was 9.5% lower at RM1.5 billion, compared with RM1.6 billion for the same period in 2016.

This was on RM6.3 billion revenue, compared with RM6.6 billion registered in 2016.

Service revenue for the financial year ended Dec 31, 2017 summed up to RM5.91 billion, a decline of 5% mainly due to lower revenues from prepaid legacy services.

Digi Telecommunications Sdn Bhd termination and exit of an agreement for information technology services with Telenor IT Asia Sdn Bhd and Telenor Global Shared Services AS, was settled with RM13.8 million, of which RM7.8 million was satisfied via a transfer of assets.

The group’s share price was up three sen to close at RM4.92 with some 3.2 million shares changing hands.


Japan says Trans-Pacific trade pact, without U.S., to be signed in March

TOKYO/SINGAPORE (Jan 23): Eleven countries aiming to forge a new Asia-Pacific trade pact after the United States pulled out of an earlier version, will hold…