Higher project margins likely for SkyWorld

PETALING JAYA: Phillip Capital Research says the strong partnership between SkyWorld Development Bhd and Singapore-based Teambuild Holding (S) Pte Ltd and the use of new technology will likely drive higher project margins for SkyWorld.

SkyWorld had announced its entry into the prefabricated manufacturing sector through a collaboration with Teambuild to establish a joint-venture (JV) subsidiary Prefab Master Sdn Bhd.

SkyWorld has a majority 70% stake in the JV while the rest is held by Teambuild.

The venture will allow SkyWorld to incorporate prefabricated and prefinished volumetric construction (PPVC) technology in its RM13bil affordable housing development in Penang, with the first phase slated to launch in the second half of the year.

“The adoption of the PPVC solution is expected to improve the overall construction quality, expedite project delivery timelines, and improve cost efficiency particularly given the large-scale development of 35,000 units of Rumah Bakat Baru Madani over 15 years,” the research house said.

Teambuild specialises in prefabricated modular units, with a proven track record in executing public and private property development projects in Singapore.

The JV entity will incur capital expenditure to set up the manufacturing facility.

“We make no changes to our earnings forecast pending further clarity from management. We reiterate our ‘buy’ rating with an unchanged revaluated net assets value-derived target price of RM1.10,” Phillip Research added.