KUALA LUMPUR (Jan 20): SkyWorld Development Bhd (KL:SKYWLD) has proposed to diversify into manufacturing prefabricated and prefinished modular systems, which it plans to employ in its affordable housing project in Penang.
The new business, which the group says could potentially contribute a quarter of its net profit, will be undertaken via a collaboration with Singapore-based prefabricated and prefinished modular systems maker Teambuild Holdings (S) Pte Ltd, according to the property developer’s bourse filing on Monday.
The group said it plans to leverage Teambuild’s expertise, skills and technical know-how as a contractor with a strong 12-year track record in the use of prefabricated and prefinished volumetric construction (PPVC) technology in the new venture.
Teambuild holds a 30% stake in collaboration vehicle Prefab Master Sdn Bhd, while SkyWorld controls 70%.
SkyWorld said it plans to use PPVC technology to support its affordable housing development project with Penang Development Corp and PDC Properties Sdn Bhd, announced back in December last year.
The joint development is expected to commence in the second half of 2025 and span 10-15 year period with a gross development value of RM13 billion.
“Given that PPVC technology will be used to support the scale and volume of its [Skyworld’s] development projects, the board anticipates the prefabricated manufacturing business could potentially contribute 25% of more to the net profits of SkyWorld and result in a diversion of more than 25% to the net assets of SkyWorld in the future,”
SkyWorld posted a net profit of RM106.78 million for the financial year ended March 31, 2024 (FY2024), RM144 million for FY2023 and RM106.04 million for FY2022. For all three financial years, its core property development segment contributed over 99% of topline.
SkyWorld said the diversification is part of the group’s effort to enhance the overall quality and reliability of the homes delivered to customers.
The diversification is to take effect immediately after receiving its shareholders’ nod. UOB Kay Hian Securities (M) Sdn Bhd is the adviser for the exercise.
Shares in SkyWorld ended half a sen or 0.93% lower at 53 sen, valuing the group at RM515.28 million.