Monday, May 4, 2015

YongTai ... From Garment Mfg To Property Developer !!!


It is mainly involves in garment manufacturing. It is beginning to see light at the end of the tunnel.

Its textile manufacturing business has been loss making for years.

It ventured into property development in 2014. Its maiden development in Melaka a JV with PTS Properties Sdn Bhd to construct a 29 storey condo hotel with a GDV of rm129 million is fully sold and on track for its opening in June 2015.

For the cumulative six months ended Dec 31 2014 the company registered a net profit of rm745000 compared with a net loss of rm1.2 million in the previous corresponding period due to a profit of rm1.45 million from its property development division. By the end of its financial year ending June 30 2015 al rm8 million in profit from its Melaka JV is expected to be recognized in its books.

The company intends to focus on tourism related properties.

It had inked another JV project with PTS Properties to develop a hotel and serviced apartment known as Apple in Melaka. YongTai expects to reap a profit of rm50 million over the next three years from April 2015 which is set for completion in 2017.

The company is also in talks with several parties for projects in Melaka and KL

It will lookout for land.

Only 40% of its garment business which includes 15 retail outlets selling clothing under hime grown brand such as Effu and Emilio Valentino is profitable.

YongTai is looking to scale down its garment operation.

As at Dec 31 2014 the company had borrowings of rm19.12 million, six times more than its cash. This translates into a net gearing of 0.97 times.

As at Dec 31 2014 Yongtai had amount due to directors totaling rm6 million.

The company had accumulated losses of rm25.25 million.

It had proposed a rights issue with warrants and a private placement to raise rm63.32 million of which rm5 million will be used to pare down its borrowings. The rest will be used in its TheApple development in Melaka and future property projects.

Its largest shareholder is the Liew family’s vehicle, Liew Fat Lin Holdings Sdn Bhd, which has a 20.69% stake.

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Please note that all data given are merely blogger's opinion. It is strongly recommended that you do your own analysis and research before investing.