PETALING JAYA: One-stop plastic solutions provider and property developer HIL Industries Bhd has today received its shareholders’ approval at its EGM to undertake residential development joint ventures (JVs) on five parcels of land in Sungai Buloh, Klang and Jugra, Selangor.
With the approval, HIL Industries will partner Unik Sejati Sdn Bhd (Unik Sejati), Pembinaan Kesentosaan Sdn Bhd and Amverton Carey Golf & Island Resort Sdn Bhd (Amverton Carey) in JVs to develop residential developments with an estimated gross development value (GDV) of RM471.1 million on 40.9 hectares of land in Selangor.
The developments will comprise 154 units of stratified double-storey terrace houses in Sungai Buloh, 78 units double-storey terrace houses in Klang, 141 units stratified bungalows and 428 units town houses in Amverton Cove, Carey Island.
On the rationale of the exercise, HIL Industries president and CEO Datuk Milton Ng said the JVs are in line with the company’s aim to expand its property business in the Klang Valley.
The JVs is an opportunity for the company to replenish its property development projects with minimal costs upfront and are expected to increase the revenue and profit contribution from the property development segment.
Based on the management feasibility studies, HIL Industries is expected to generate an estimated gross development profit of RM96.1 million from the JVs which would also allow it to participate in the developments without an outright purchase of the land which will otherwise require significant cash outlay.
In addition, the landowners’ entitlements will be paid entirely in terms of units instead of cash, which will ease and conserve HIL Industries’ cash flow for its operations, he added.
Moving forward, HIL Industries will continue to source and look out for opportunities to obtain more development land within the Klang Valley to ensure the continuous growth of its property business.
The company’s property development segment recorded a revenue of RM80.1 million and profit before tax (PBT) of RM20.7 million, which represents 49.1% and 66.5% respectively of the group’s financial results for the financial year ended (FYE) Dec 31, 2020.
For the nine-month FYE2021, the property development segment achieved a revenue of RM48.6 million and PBT of RM17.9 million, which represents 49.7% and 85.4% respectively.
Amverton Prop Sdn Bhd, a wholly-owned subsidiary of HIL Industries had on April 20 last yearentered into four conditional joint venture agreements (JVAs) with Unik Sejati, Pembinaan Kesentosaan and Amverton Carey to undertake residential developments in Selangor. Further, on Nov 18, Amverton Prop entered into four supplemental agreements to vary certain terms of each JVAs.