AP plans B40bn new projects

AP plans B40bn new projects

SET-listed developer AP (Thailand) is acting bullish this year, with plans to launch 24 projects worth a combined 40 billion baht and expected growth of almost 25% in presales.

Chief executive Anuphong Assavabhokhin said the expected economic improvement was the main factor in the company launching projects at the highest value in its 23-year history.

"Momentum is good, as seen from sales last month of 1.55 billion baht, the highest January figure since AP was founded," he said.

"We have weekly and quarterly targets and revise our plan if anything wrong. This strategy can help us detect the sales situation at each site. Property business changes by the week."

Mr Anuphong said an unstable political situation was not a concern as long as there was no violence. With the world's unreliable economy possibly affecting Thailand, it would survive through product diversification and focus on condos along current and new mass transit lines.

AP plans to spend 12 billion baht on project construction and 8 billion baht on new land. The land budget can be reduced or frozen if new projects fail to achieve good sales.

Of the 24 new projects, 10 sites worth a combined 27 billion baht will be condos and at least one will be a joint venture with Japanese partner Mitsubishi Estate Group. Nine projects worth 8.15 billion baht will be townhouses and five projects worth 4.84 billion will be single houses.

Despite high sales value of new condo projects, AP will cap its debt-to-equity ratio at one time, the same as last year.

AP expects 28.3 billion baht in presales this year, up from 22.7 billion baht in 2014 which rose by 49% from 2013. It aims to achieve 25.3 billion baht in revenue, an increase of 10% from 2014.

As of the third quarter last year, the developer had a sales backlog of 21.4 billion baht, which comprised condo units of 15.3 billion baht and single houses and townhouses of 6.1 billion.

Of the condo sales backlog, 8.6 billion baht will be transferred this year, with AP confident of unit transfer due to a business strategy it has applied since late 2013.

"We use Bangkok CitiSmart, our brokerage subsidiary, to screen out speculators by asking them whether they will sell their booked unit or not. If they agree to sell, they are speculators. We will find real buyers to buy their unit," Mr Anuphong said.

AP shares closed yesterday on the SET at 6.45 baht, up 10 satang, in trade worth 78.2 million baht.



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