Aspen (Group) Holdings Limited - Phillip Securities 2018-02-01: Entering Into An Opportune Time

Aspen (Group) Holdings Limited - Phillip Securities 2018-02-01: Entering Into An Opportune Time ASPEN (GROUP) HOLDINGS LIMITED 1F3.SI

Aspen (Group) Holdings Limited - Entering Into An Opportune Time

  • We attended a site visit hosted by Aspen (Group) Holdings Limited (“Aspen”) to its flagship project Aspen Vision City (GDV: RM10bn) on Mainland Penang, a few of their other development sites and a sales gallery of its ongoing and pipeline projects on Tuesday, 17 January 2018. 
  • We also met with the President & Group CEO, Dato’ M. Murly, and the Chief Financial Officer, Christopher Looi, who shared with us more on the Group’s developments and insights on the Malaysian property market.

Company Background 

  • Listed on the SGX Catalist Board on 28 July 2017, Aspen (Group) Holdings Limited is a Malaysia-based property development group that develops affordable residential and mixed development properties. 
  • The Group’s flagship project, 245-acre Aspen Vision City (in Bandar Cassia, Batu Kawan, Penang, Malaysia), is the result of its joint-venture partnership with Ikea Southeast Asia (Ikea) (through owner Ikano Pte Ltd).

Site Visit Highlights 

Aspen Vision City (AVC) to create new communities and opportunities 

  • Township complete with homes, offices, malls, schools, transport hub, industrial parks, medical facilities with robust infrastructure in place (located right at the mouth of Penang second bridge). 
  • Creation of jobs with opening of factories, malls, and other services 

Benefiter of enlarged focus on affordable housing 

  • Aspen, as a provider of affordable homes, is well positioned to benefit from the increased focus on affordable housing in Malaysia’s 2018 budget. 
  • High take-up of unique “value-add” packages ensures healthy bottom-line; 82.7% of units sold for a 3Q18 TOP launch and 64.61% for a 1Q21 TOP launch. 
  • Unbilled sales of RM1.02 billion to underpin revenue growth 

Strategic partnership with Ikea 

  • Aspen and Ikea have jointly developed AVC through a joint venture, with stakes of 80% and 20% respectively. Both entities also have a combined stake in Bandar Cassia Shopping Centre in AVC. 
  • Ikea store in AVC will be the first in the Northern region of Peninsular Malaysia. It is slated to operate in 1Q19 and is expected to be one of AVC’s main draws. 
  • Track record and execution ability going forward has potential to pave the way for other similar partnerships with Ikea and/or other developers 

Investment Actions 

  • No stock rating or price target provided, as we do not have coverage on Aspen.

Phillip Research Team Phillip Securities | 2018-02-01
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