IJM says it can weather the storm

IJM says it can weather the storm
By Zaidi Isham Ismail
Published: 2008/08/27
BTimes

MALAYSIA’S second-largest builder IJM Corp Bhd expects to perform well in fiscal 2009 as a slowdown in its construction division will be offset by its other businesses.IJM group managing director Datuk Krishnan Tan Boon Seng said although the company is affected by rising raw material cost, high oil prices and worldwide inflationary pressures, it will be able to weather the storm for the rest of the year.“The company has five business divisions which are construction, property, plantations, industries and infrastructure and others and each sector poses its own set of challenges.“The construction sector is not doing well right now but at the same time the other four are doing well.

“So, overall IJM should be doing allright this year,” Tan told reporters in Selangor yesterday after the company’s annual general meeting.IJM returned to profitability with a RM91.3 million net profit in the first quarter to June 30 2008 compared with a net loss of RM746.8 million in the same quarter a year ago.

On the listing of its Indian unit, Tan said the plan has been deferred due to the high interest rate of 13 per cent which will affect property demand in the sub-continent.“It is not the right time to list but ultimately we will have to do it,” said Tan.The builder plans to raise as much as RM200 million by selling shares in IJM (India) Infrastructure Ltd, the largest foreign-owned company in the infrastructure and construction sector in India.

On the RM3.2 billion West Coast highway project, Tan said work has not started and cost has risen to double-digit figures.IJM Corp holds a 25 per cent stake in the highway via Kumpulan Europlus Bhd.Tan said IJM wants to grow its other businesses such as its water treatment plant in Vietnam, a power plant in India and is also looking at other seaports.He said international markets especially the Middle East will be the main growth area as it is flushed with oil money.It now has two construction jobs in Bahrain and one each in Dubai and Abu Dhabi in the United Arab Emirates.