PSH to launch 75 projects worth B66.7bn
SET-listed property firm Pruksa Holding Plc (PSH) plans to launch 75 new residential projects worth a combined 66.7 billion baht, aiming to have presales growth of 13% to 53.7 billion baht by the end of the year.
Supattra Paopiamsap, deputy group chief executive, said the company expects presales to be double the overall market’s growth of 3.4%. The overall market is expected to see 420 billion baht in presales, up from 406 billion last year.
The company aims for 50.5 billion baht in 2018 revenue, growth of more than 10% from last year, while net profit is projected to rise 13% this year and 15% in the next five years.
According to the company’s market research, presales in the residential market this year will be boosted by townhouses, which will see growth of 8% to 82.5 billion baht, while condominium and singlehouse presales will see an increase of 4% each to 230 billion baht and 95.5 billion baht, respectively.
Housing transfers will total 303 billion baht, marking growth of 7.5% from 282 billion baht last year. The highest growth will be from condos, with a rise of 10.5% to 159.5 billion baht, followed by single houses, which will increase 4% to 76.5 billion baht, and townhouses, which will see 3.5% growth to 58 billion baht.
“The property market will continue expanding on positive factors, including low interest rates and construction of transport networks, including mass transit lines,” Mrs Supattra said. “We will sustain leadership in real estate, accelerate hospital development for recurring income and improve efficiency.”
This year, PSH’s key mission is to build brands and establish Pruksa as a trust mark. It has stopped developing 34 housing brands and has kept 14 brands for single houses, townhouses and condos in the upper-end and mid- to lower-priced segments.
“We will improve our efficiency and aim to reduce housing defects from 50% to 30% this year and to zero defects in the next five years,” said Mrs Supattra, 55, who was chief executive of Unilever Thai Trading before joining PSH last September.
Piya Prayong, chief executive of Pruksa Real Estate Plc, a PSH subsidiary, said Pruksa will apply new sales strategies for the middle and lower-end segments, including selling through international sales agents and boosting sales through referrals from existing customers.
To reduce the bank mortgage rejection rate from 7% last year and 8% in 2016, the company will select customers whose profiles meet the banks’ targets and preferences.
“We continue pooling construction to reduce overhead costs by at least 1%, which will boost gross profit margins,” Mr Piya said, adding that gross profit in the first nine months of 2017 was 35.7%, up from 34.1% in 2016.
Prasert Taedullayasatit, another chief executive for premium business, said low interest rates and the rising SET index will help boost residential demand in the upper-income segment.
According to Pruksa’s market research, the market value of the luxury segment totalled 315.34 billion baht from 83,256 units in the first nine months last year, compared with 362.45 billion baht from 101,432 units in 2016. The value accounted for 25-34% of the total market.
Pruksa last year posted 8.16 billion baht in presales from the luxury segment, 200% higher than the target of 4.2 billion baht, from the launch of five projects worth a combined 8 billion baht.
The company aims to have 6.8 billion baht by the end of the year from eight projects worth a combined 10.26 billion baht being launched this year.
PSH shares closed yesterday on the Stock Exchange of Thailand at 24.10 baht, up 60 satang, in trade worth 233.1 million baht.