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TWL Holdings Berhad (TWL), or formally known as Tiger Synergy Berhad, had in the past 3 quarters delivered good sets of financial results. However, the share price of TWL did not mirror the performance of Bursa Malaysia Properties Index.
For the uninitiated, TWL is a diverse company with plantation and timber, property and construction, and cement batching business. As the concession agreement of the timber segment comes to a close, the company will cease to recognise revenue and profit from the timber business, which would be replaced with the plantation business.
For the avoidance of doubt, the plantation business had yet to begun the planting, hence for the coming financial years (FY24/FY25), the bulk of the company’s revenue and profit is likely to be delivered from property development business, as both construction and cement batching business are designed to support TWL’s property business.
So far, TWL has completed one flagship project, namely the Bukit Sri Putra with GDV RM160.17 million, which consists of 170 units of 3-storey linked houses.
TWL had back in 2021 and 2022 launched Telaris Alam Impian which has a GDV of RM196 million, and now the project is fully sold, with foundation works (initial 20% progress claim) completed, and pending recognition of revenue and profit into the company.
Notably, this is a completely fresh revenue and profit recognition, which could yield a net margin of over 30% according to sources, as the land costs were relatively low at circa RM10 million, and construction manpower and materials were controlled in-house.
The construction of the project is expected to be completed within 2 years, which means the project could yield approximately RM30.0 million per financial year to TWL, excluding the few upcoming projects of the company:-
• TWL Alam Impian (Affordable Housing Project) with GDV of RM330 million, 1,000 units on 11.9 acres of freehold land.
• Pangsapuri Harmoni TWL (Affordable Housing Project) with GDV of RM207 million, 715 units on 5.49 acres of freehold land.
• Taman Pinggiran USJ (Affordable Housing Project) with GDV of RM216 million, 746 units on 6.19 acres of freehold land.
• Putra Heights Project (Affordable Housing Project) with GDV of RM273 million, 1,139 units on 8.75 acres of freehold land.
• Sungai Buloh Project (Affordable Housing Project) with GDV of RM160 million, 571 units on 5.5 acres of freehold land.
Beyond these projects, TWL had another 4 projects in their development pipeline, which is expected to provide the company with a foreseeable stream of income going forward.
So, why did the share price of TWL remain low at the current level?
80m profits coming in these two years, NTA 10c. Profits 80m. PE 10times. You guys do the mathematic. You think owner just want to do distributions @ 3c? I don’t think so. Got bigger plan coming I think
