IPO: KTI Landmark’s Debuts Flat On Ace Market Matching Listing Price

Sabah-based integrated property developer KTI Landmark Berhad’s (KTI) initial public offering (IPO) for the public portion saw its debut on Bursa Malaysia’s Ace Market today opening at 30 sen matching its IPO price.

At 9.45am, the stock remained on a high of 30 sen with some 17.4 million shares traded. The company raised RM48 million from its listing exercise as part of its expansion plans.

KTI aims to raise RM48.0 million from its IPO with the stock oversubscribed by 8.14 times.

KTI is poised to launch two residential projects with a combined gross development value (“GDV”) of RM599.6 million by 2028.

Dr Gordon Loke, Group Managing Director and CEO of KTI, said these upcoming launches encompass a diverse range of offerings including three phases of affordable landed homes in Sandakan, and a mixed development – Ayuria Place, Alamesra in Kota Kinabalu.

“The three phases of affordable landed homes in Sandakan with an estimated RM107.9 million GDV, comprises 310 units of double-storey terrace houses. It is a design and build construction project with Lembaga Pembangunan Perumahan dan Bandar (“LPPB”), the state agency in Sabah. 

“Our Group has received the development order, but has resubmitted the amended development plans for approval and is pending the approval for building place to commence construction works. 

“The remaining RM491.7 million GDV mixed development, Ayuria Place, Alamesra is a project under our own property development. The projects will feature three blocks of 39-storey of 1,269 apartment units between 650 sq ft and 1,000 sq ft. This development is poised to be one of the landmark projects in Kota Kinabalu as it’s strategically located from Kota Kinabalu City Centre and within close proximity to various educational institutions as well as convenient access to major highways,” he added. 

In the financial year ended 31 December 2023 (“FY23”), KTI managed to lock about RM132.9 million sales, while the amount of unbilled sales reached a record high of RM711.3 million.

Looking ahead, Dr Loke anticipates that these unbilled sales will be gradually recognised over the course of the upcoming financial years. 

The Company had successfully raised RM48.0 million in its initial public offering exercise, to partly fund its acquisition of land for development amounting to RM18.0 million.

Of the proceeds, RM20.7 million will be allocated as working capital for project development and RM0.3 million to upgrade software and systems. 

A sum of RM2.2 million will be used to upgrade and expand its existing casting yard or IBS facility, followed by RM3.0 million for repayment of bank borrowings and the remaining RM3.8 million for its estimated listing expenses. 

To date, KTI has delivered projects with a total GDV of RM1.2 billion, of which RM1.0 billion from the provision of design and build construction projects while the remaining RM207.6 million from its own property development projects.

Currently, it has a total of RM2.2 billion GDV on-going and upcoming projects across Kota Kinabalu, Tuaran, Sandakan and Papar in Sabah, where 30% are projects awarded by LPPB and the remaining are joint venture or its own projects to be developed until 2028.

The Company’s notable projects include among others; Taman Wawasan in Beaufort, Taman La Gloxinia in Papar, Taman Seri Lemawang in Tuaran as well as Taman Nelly, Taman Lavender and The Logg in Kota Kinabalu.

For the financial year ended 31 December 2023 (“FY2023”), KTI’s net profit rose 31.9% to RM13.8 million, from RM10.5 million a year ago (“FY2022”) on higher gross profit (“GP”). FY2023 revenue increased 6.5% to RM120.2 million from RM112.9 million in FY2022.

During the period under review, the Company’s GP expanded to RM35.6 million, translating to a GP margin of 29.6%, versus 27.3% in FY2022 due to a mix of contributions from projects with higher GP margins. Net margin for FY2023 also improved to 11.5% from 9.3% a year ago. 

M & A Securities Sdn Bhd was the Adviser, Sponsor, Underwriter and Placement Agent for the IPO exercise.

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