MELAKA IMPRESSIONS AND IMPRESSIONS CITY IMPACT ON YONG TAI

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KUALA LUMPUR: RHB Research projects a multi-fold rise in net profit for Yong Tai as the former garment company focuses on property development.

“This would be underpinned by the Impression City project, which would see a potential total gross development value (GDV) rise to RM6.1bil from RM164mil currently,” it said.

The research house said this  ought to keep the group busy for the next eight to 10 years. Impression Melaka, it added, offers a further upside to both earnings and valuations.

“We estimate a valuation range of RM1.03 to RM1.18,” it said as it initiated coverage.

RHB Research said in line with the group’s overall expansion plan into the property sector, Yong Tai has announced several proposals.

They are the RM37mil acquisition of a 17 acre plot in Melaka (Impression Land) for the development of a theatre to produce the Impression Melaka as well as the acquisition of PTS Impression (to hold a 30-year license to stage the show) for RM3mil. It also has a joint venture to develop 100 acres of land adjacent to the Impression Land.

The company is also undertaking a fund-raising exercise to raise more than RM300mil.

“The proposals are expected to be completed/take effect by 1HFY17 (June),” it said.

RHB Research said Impression Melaka, which is the first of its kind outside China, is a live cinematography show that utilises the latest light and sound technologies, modern art concepts and cultural performers.

This is to be the first live largescale Impression Series outside of China and is one of the “entry point project” within the National Key Economic Area (NKEA) initiative for the tourism sector. The performing arts centre is estimated to cost RM300mil, with completion targeted for end-2017.

“Management expects Impression Melaka to contribute RM50mil to RM60milper annum in bottomline thereafter,” it said.

The research house said Impression City is expected to contribute RM5.4bil to total GDV. Concurrent with the construction of the theatre for Impression Melaka, Yong Tai is to develop the land adjacent to it (the development collectively known as Impression City).

The mixed development project includes residential, commercial and retail units. The total GDV over an eight to 10 years period is estimated to be RM5.4bil.

“Management believes the Impression Melaka project would spur the growth of tourism and related industries such as real estate, hotels and eateries, that is catalysts for Impression City.

“We project for Yong Tai to turn around and post a net profit of RM14mil in FY17, accelerating to RM64mil in FY18. This is underpinned by the progress of its property projects. Our forecasts do not factor in the contribution from Impression Melaka, which we have pushed to FY19.

“We derive an indicative valuation estimate range of RM1.03 to  RM1.18 (fully diluted) based on SOP. The low end of our valuation range excludes Impression Melaka while, for its property development business, we have ascribed a 40% discount to its RNAV.

“The top end of our valuation range incorporates the show, where we estimate the business to be worth RM107mil based on DCF. We see upside to our valuation for Impression Melaka as execution risks ease. Our indicative valuation estimate range implies an FY18F P/E of seven to eight times (10.6 to 12 times, fully diluted),” it said.

DPM to launch Malaysia’s Pavilion at World Expo Milano 2015

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DPM to launch Malaysia’s Pavilion at World Expo Milano 2015

http://www.nst.com.my/node/83622

MILAN, 9 May: Malaysia is poised to expand its relations with the European Union, be it in trade and investment or people-to-people connectivity. Deputy Prime Minister Tan Sri Muhyiddin Yassin urged the EU business community to discover, or re-affirm, Malaysia’s attraction as the preferred investment destination in Southeast Asia.

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Speaking at the launch of the Malaysia Pavilion at the World Expo Milano 2015 here today, Muhyiddin highlighted the country’s strong economic fundamentals, underpinned by comfortable levels of external reserves, low external debt, low unemployment, and healthy inflows of foreign direct investments. However, he acknowledged there were challenges, which the country was determined to meet to ensure and sustain growth. “We expect to grow to hold steady between 4.5 and 5.5 per cent this year despite the global economic environment,” Muhyiddin, who is on a three-day working visit to this Italian city, said.

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The deputy prime minister arrived here on Thursday. Muhyiddin said the success of the Economic Transformation Programme (ETP) launched in 2010 coupled with the Government Transformation programme (GTP) could be seen in the country’s trade and investment numbers. “We attracted a total of USD68 billion in investments, both foreign and domestic.

The services and manufacturing sectors continued to play the leading role with 63.4 per cent and 30.5 per cent contribution respectively towards the approved investments in 2014. “In terms of trade, Malaysia’s total trade expanded by two per cent to total about USD445 billion in 2014, compared with about USD435 billion in 2013.” Muhyiddin also spoke on the country’s improvement in competitiveness based on reports by international organisations such as the World Bank, the World Economic Forum and the Swiss Institute of Management Development.

The establishment on the Asean Community by Dec 31, this year, he added, would mark the fruition of the grouping’s goal of creating a regional entity of “one vision, one community, one identity”. “A key aspect of the Asean Community is the Asean Economic Community (AEC), designed to create a single market and production base in Asean. The establishment of the AEC at the end of this year sends a powerful signal that Asean is commited to market liberalisation and the facilitation of trade and investment.”

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On the Malaysia Pavilion which carries the theme Towards a Sustainable Food Ecosystem, Muhyiddin said its design reflected the nation’s rich biodiversity, and drew inspiration from a humble seed, a symbol of growth. The expo, held for the first time in 1914, showcases participating countries’ technologies in ensuring food sustainability.

Open to the public from May 1 to Oct 31, some 20 million visitors from around the world are expected to visit its 1.1 million square metres of exhibition area. A total of 145 countries are taking part in the expo this year, which would provide Malaysia a platform to display its development from an agricultural country to what it is today, as well as promote trade and investment. Visit http://www.malaysiapavilion2015.com.my/ for more details.

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