Gagasan Nadi moves big into affordable housing

MD foresees there will be more projects to be developed as the govt intends to add 200k units of affordable homes within the 11MP period

By SHAHEERA AZNAM SHAH / Pic By ISMAIL CHE RUS

GAGASAN Nadi Cergas Bhd is well-positioned to take advantage of the property market’s new focus on the affordable housing segment, which is also backed by the government’s policy aimed at alleviating home ownership woes among Malaysians.

Its MD Wan Azman Wan Kamal said with the higher demand in the affordable home segment as a result of the government’s campaigns, the property sector is set to see a more bullish outlook.

“There is a shortage in the affordable housing segment, as demonstrated in our recently secured project in Putrajaya. I think there will be more projects to be developed as the government intends to add 200,000 units of affordable homes within the remaining 11th Malaysian Plan (11MP) period.

“We are bullish that we are able to fill the gap and step forward to build those homes,” he said after the listing of Gagasan Nadi on the ACE Market yesterday.

On Monday, Gagasan Nadi announced that it has secured an RM109.99 million contract to build two blocks of apartments in Putrajaya.

In a filing to the local bourse, it said its wholly owned subsidiary Nadi Cergas Sdn Bhd has received and accepted a letter of award from Putrajaya Homes Sdn Bhd to build the public residential development, which is expected to be completed by November 2021.

Wan Azman said the company will shift its business to become a major player in affordable housing as the sector is expected to have a positive outlook in the next couple of years.

“In 2018, 60% of the housing loans approved were for the affordable homes and houses below RM500,000.

“The trend will push developers’ commitments into building more of such homes, as envisioned by the government,” he said.

At present, Gagasan Nadi’s construction orderbook stands at RM700 million, a hefty amount that would keep the company occupied until 2022.

Gagasan Nadi’s projects include the Cardiology Centre for Hospital Serdang, Rumah Selangorku in Putra Heights and Bukit Raja in Selangor; 1Malaysia People’s Housing in Pasir Mas, Kelantan; and a learning institution in Bagan Datuk, Perak.

Wan Azman said the company has no immediate plan to increase its landbank. However, he does not discount the possibility of acquisitions in the future.

“We have 116 acres (46.94ha) of residential land in Ulu Yam, Selangor, and half an acre in Chow Kit, Kuala Lumpur, worth between RM50 million and RM60 million combined.

“We are still planning the most viable future development for the pieces of land and we are not in a hurry to develop them.

“We are also not aggressively looking to collect landbank unless they are good sites, because that is not within our forte,” he said.

At the listing, Gagasan Nadi’s shares opened at 39 sen, nine sen above its offer price.

The firm’s initial public offering is expected to raise RM60 million, of which RM42 million would be derived from the public issue of 140 million new shares and RM18 million from the sale of 60 million existing shares.

Gagasan Nadi closed its maiden trading at 30 sen, with 118.59 million shares traded at RM38.89 million.