Construction of Duke 2 within RM1.18 bil cost, says Ekovest

KUALA LUMPUR (Feb 23): The construction of Phase 2 of the Duta-Ulu Klang Expressway (Duke 2) remains within the cost of RM1.18 billion, Ekovest Bhd said, despite a weakened ringgit that has pushed up raw material costs.

Ekovest managing director Datuk Seri Lim Keng Cheng (pictured) said the project is now 72% complete, with full completion by year end.

“The majority of our raw materials are sourced locally and thus, we are not exposed to currency fluctuation,” he told reporters after launching its graduate attachment programme yesterday.

Lim added that the worldwide steel market is currently characterised by an oversupply situation, which has pressured prices downwards.

“Global oil prices have also fallen substantially [since mid-2014]. These two factors (lower steel and oil prices) have helped keep our [construction] costs down,” he noted.

Duke 2 is expected to open to traffic next year. It connects the east and west of the capital through the 7km Sri Damansara Link and a 9km link from Jalan Tun Razak.

Lim also said the group had submitted a proposal to the Kuala Lumpur City Hall (DBKL) to build Duke 2A, which will provide public access to Kampung Baru. Duke 2 currently ends at Hospital Kuala Lumpur.

“We have submitted our proposal to DBKL and are awaiting their approval,” he said.

Operationally, Lim said Ekovest is expected to achieve double-digit growth in revenue for the financial year ending June 30, 2016, underpinned by its solid order book.

“Currently, we have an outstanding order book of RM2 billion, which will be realised this year.

“If we include Duke 3 into our order book, our order book could triple to RM6 billion, which can support our earnings for the next few years,” he added.

Measuring 35km, Duke 3 is estimated to cost RM3.57 billion and will traverse north to south of Kuala Lumpur, and will serve areas such as Universiti Tunku Abdul Rahman, Wangsa Maju, Setiawangsa, Ampang, the Tun Razak Exchange, Bandar Malaysia development corridor and Kerinchi.

On its tender book, Lim said Ekovest is tendering for several major infrastructure projects, such as Sungai Besi-Ulu Klang Expressway and the light rail transit projects.

Lim also said Ekovest will not seek new partners for its RM4 billion River of Life project here after the exit of Malaysian Resources Corp Bhd (MRCB) from the project.

“This is their (MRCB) strategic planning and [they] want to focus on the property business. We also think that there was no point of having two managers for the project.

“The project will proceed as planned and we will do it on our own,” he added.

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This article first appeared in The Edge Financial Daily, on Feb 23, 2016. Subscribe to The Edge Financial Daily here.