“Singha Estate” is confident to go ahead with its investment and development plan in the second half of 2019, expecting full-year revenue to grow more than one timedespite the slowing property market. Quality projects in growth potential locations remain having bright prospect.
Mr. Naris Cheyklin, Chief Executive Officer of Singha Estate Plc or “S” outlined the company’s business direction in the second half of 2019 that Singha Estate will continue to implement its investment and property development plan to drive revenue to exceed 20 billion baht in 2020. The company has an investment budget of 8-10 billion baht this year.
Currently, Singha Estate operates its investment and property business with three core business units comprising office and commercial, hospitality and residential. The company envisions itself to become “Global Holding Company” through various strategies to expand business locally and abroad, build premium brand image, and adjust organization to have flexibility to cope with changes. It also focuses on sustainable development to generate good returns to all stakeholders.
In the second half of this year, Singha Estate expects to have rising sales and revenue recognition from the unit transfers, which is forecast to grow from the first half. The new project launches in the second half include a new residential condominium in Soi Rangnam and Oasis office-cum-retail complex on Vibhavadi-Rangsit Road as well as the opening of two hotels at The CROSSROADS, Maldives. With all these plans, the company will completely become the Global Holding Company by this year.
For the existing projects, Singha Estate has realized revenue from THE ESSE ASOKE since late last year while THE ESSE @SINGHA COMPLEX will transfer unit ownership to buyers in the third quarter of this year. Apart from the two projects, the revenue recognition will gradually come from the other projects. Presently, the company has its backlog worth 12 billion baht on hands, of which majority of revenue will be realized in 2019 and the rest in 2020.
“We will go ahead with our investment plan in the second half even though the overall property market has a slowdown due to the impact from internal and external negative factors such as economic slowdown and a strict implementation of loan-to-value, which is hurting homebuyers’ demand. We’re flexible to deal with market challenges and give importance on sustainable growth in long term,” Mr. Naris said.
2019 is a harvesting year for Singha Estate to realize revenue from its investment in Outrigger Group which has six hotels in many countries namely UK and Thailand, and THE OFFICE AT SINGHA COMPLEX, which has been already completed. The company will start realizing some revenues from The CROSSROADS Maldives.
Furthermore, Singha Estate has plans to bring its hospitality business, S Hotels & Resorts Plc, to seek listing on the Stock Exchange of Thailand (SET) near the end of this year. S Hotels & Resorts aims to be a premier hotel investment and resort management company by crafting quality settings in a sustainable environment where guests can relax, play, work, enjoy and share instant stories. Through our property management and asset ownership, we strive to create unique travel experiences for our guests while driving financial growth and creating value for our stakeholders.
The listing of S Hotels & Resorts will strengthen Singha Estate’s financial positioning and make its readiness to expand its hospitality business for S Hotels & Resorts in major tourist destinations worldwide.
Early 2019, Singha Estate successfully established SPRIME trust fund for its office building business, which could attract a warm response from investors. Prior to this, it brought a residential development subsidiary, Nirvana Daii Plc, to seek listing on the SET in 2017.
In the first quarter of 2019, Singha Estate posted a net profit of 293 million baht, increasing 13% from the same period last year, on total revenue of 3 billion baht, up more than 160% year-on-year.