KUALA LUMPUR (March 20): Chin Hin Group Property Bhd (CHGP) has big plans. It was announced recently that the group was diversifying into construction by acquiring a 45% stake in Aima Construction Sdn Bhd, a construction company from Alor Setar, Kedah.

Datuk Seri Chiau Beng Teik and eldest son Chiau Haw Choon (the Chiau family controls Chin Hin Group) are “thinking ahead for CHGP and Aima Construction”, The Edge Malaysia reported.

CHGP executive director Haw Choon told the weekly that Aima Construction is currently focusing on building houses, but it is not involved in infrastructure works yet.

“Our idea is to grow the company via a merger and acquisition (M&A) because it has a good balance sheet with a strong cash position.”

CHGP also “plans to use the construction firm to acquire an infrastructure company in the next six months, in a move to make the builder’s business sexier”, wrote The Edge.

“With our networks in the property and building material sectors, I really think we can add value to Aima Construction. Our target order book upon submission of IPO is RM700 million in the next three years,” Haw Choon revealed.

“In the next three years, we hope that Aima Construction and the infrastructure company to be acquired can collectively generate a profit of RM10 million. By then, they should be ready for an IPO,” he added.

Aima Construction managing director Khor Ken Yeon also sees “synergistic benefits” from the proposed acquisition. “[On] CHGP’s plans to launch RM3.73 billion worth of projects in the coming years, we expect to see significant participation from our end, as construction work on properties has been our forte for several decades,” Khor said.

Haw Choon told the business publication that his “intention” is to make CHGP a property and construction group.

It hae been reported that the company has been actively beefing up its landbank over the past six months.

Last month, it announced plans to acquire 81.9 acres of land in the Klang Valley for RM268 million, on which it would develop five projects with a combined GDV of RM3.73 billion over the next two years.

“We also intend to inject another joint-venture property project into CHGP, which will bring our total GDV to RM4 billion. This will keep us busy over the next two to three years. Given the clear earnings visibility of CHGP, we hope investors will pay a bit more attention to our stock,” Haw Choon said.

He wants to build CHGP into “one of the major property developers in town, with a market capitalisation of RM500 million to RM700 million in the next three years”. CHGP currently has two ongoing projects: Aera Residence and 8th & Stellar.

Read the full report in this week’s The Edge Malaysia

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