SC Asset budgets Bt11 bn for 16 new projects
Bt3 bn to be used to buy undeveloped land, Bt8 bn to construct the infrastructure
SC Asset Corporation, the property arm of the Shinawatra family, has set aside Bt11 billion to develop 16 residential projects worth Bt17 billion this year.
Under its investment plan, Bt3 billion will be used to buy undeveloped land and Bt8 billion to construct the infrastructure for the projects.
Half of the funds will come from internal cash flow and half from bank loans. This will raise its debt-to-equity ratio from 0.9 times to 1.2 this year.
The plan is to boost its presales by 20 per cent to Bt10 billion |this year from Bt8.1 billion last year, chairwoman Busaba Damapong told a news conference yesterday.
Of the 16 new projects, 12 worth Bt11.5 billion are low-rises – detached houses, townhouses and a home-office building. Four projects worth Bt5.6 billion are condominiums.
Two projects will be in Hua Hin and Cha-am in the first move of the company into the provinces. One is a condominium called The Crest Santora Hua Hin worth Bt1.2 billion that will be launched next month. The Cha-am project will be a low-rise that will be marketed in the last quarter.
With the new projects worth Bt17 billion combined with 16 existing residential projects for sale worth Bt11.5 billion, the company will have 32 projects for sale worth Bt28.5 billion this year.
Kree Dejchai, chief operating officer, said the company was also studying a residential project in Pattaya for next year.
The company has Bt3.4 billion in presales waiting to be realised as revenue, of which up to 60 per cent will be booked this year.
"We believe that our total |revenue will grow at least 10 |per cent this year," he said.
The company is aiming for a net profit margin of 13-15 per cent this year even though its construction, energy and labour costs are rising by 8-10 per cent. But the company cannot raise residential prices to match the higher costs.
"We cannot hike prices up to 10 per cent because the market has high competition. If we have to increase our prices, it may be 3-5 per cent. This depends on market competition," Kree said.
However, the company will maintain its net profit margin at nearly last year’s level by controlling its management and financial costs at below last year.
SC Asset Corp earned Bt1.1 billion on revenue of Bt6.6 billion last year. For the first nine months of last year, it earned Bt949.9 million on revenue of Bt5.8 billion.
"Our sales in the last quarter of last year were lower than the target of about Bt1 billion because of the flood that hit Greater Bangkok, but our revenue has continued to meet our growth target," he said.
