KUALA LUMPUR (April 23): Eco World Development Bhd will not propose any dividend for its shareholders for the next two to three years as it is still in a growth phase, its chief financial officer Datuk Heah Kok Boon said.
He said the property developer will be focusing on its future growth and is undertaking several corporate exercises including a proposed rights issue with warrants and a 20% proposed private placement to fund for all the acquisitions and future working capital of the group.
"If funds from the rights issue and private placement are used to pay dividends then it'll be like borrowing your (shareholders') money to pay you back right?," Heah told a news conference on the sidelines of Invest Malaysia Kuala Lumpur here today.
Eco World president and CEO Datuk Chang Khim Wah (pictured), meanwhile, is positive on the residential property market in Iskandar Malaysia, Johor, despite admitting that there is currently a glut in the area.
In a research note issued by Maybank Investment Bank Bhd on April 14, 2015, it had urged investors to be cautious about the region, noting that property transactions and prices in Iskandar Malaysia had been dropping.
It added that the property oversupply situation in Iskandar Malaysia was "likely to get worse before it gets better".
Eco World shares traded 0.54% lower at RM1.84 in morning session, bringing a market capitalisation of RM3.65 billion.
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