Tuju Setia Bhd announces a major stride forward with a RM209 million contract awarded by Avaland Bhd (formerly known as MCT Bhd) for the construction of two service apartment blocks in USJ 25, Subang Jaya.
This new project, Alora Residences, marks the first phase of the ambitious 2Fifth Avenue, a 13-acre integrated development in USJ, boasting a gross development value of RM3 billion. The project is scheduled for completion within 33 months, with work expected to start in the second quarter of 2024, as per Tuju Setia’s announcement in a bourse filing.
This contract is anticipated to significantly bolster Tuju Setia’s earnings and net assets for the financial year ending December 31, 2024, and continue until the completion of the contract.
Wee Eng Kong, managing director of Tuju Setia, expressed optimism about the contract, seeing it as an auspicious start to 2024. “The recent stabilization in building material prices has led to a more favorable environment for property developers, sparking progress in bidding discussions for upcoming projects. This trend augurs well for Tuju Setia, enhancing our prospects for securing new contracts and boosting earnings,” he stated.
Wee further noted that the Alora Residences project would not only enhance Tuju Setia’s portfolio but also pave the way for the company to engage in more green development projects. The project positions Tuju Setia favorably for future collaborations with both new and existing clients, as well as potential involvement in upcoming Avaland developments.
Currently, Tuju Setia’s project roster is dominated by high-rise constructions, including notable developments like Emerald 9 in Cheras, Jernih Residence in Kajang, Sunway d’hill Residences in Kota Damansara, One Equine in Seri Kembangan, and the design and build project of the Kajang Women and Children Hospital.
Despite this new contract, Tuju Setia’s share price witnessed a minor decline, closing down by 0.5 sen or 2.44% at 20 sen. This pricing positions the group with a market capitalization of RM63 million, a notable decrease from its initial public offering price of 70 sen in May 2021, representing a 71% decline.