Indonesia: a new growth market for Scientex real estate

Packaging maker turned real estatedeveloper Scientex Bhd increased property sales in the second quarter ended January 31, 2023, and is now looking to expand into Indonesia.

The company's CEO Lim Peng Jin said:

"Our long-term goal is to grow the Scientex brand in Indonesia's real estate sector and share our knowledge, experience and expertise in affordable housing in the region."

Lim said that with the completion of some 28,000 affordable housing units worth 8 billion ringgit in Malaysia, the company was ready to launch a strategy to enter new markets in Southeast Asia and meet local demand.

Scientex's net profit in the second quarter of 2023 rose 13.5 percent to 106.3 million ringgit from 93.7 million ringgit a year ago, driven by improved sales of packaging materials, real estate and steady progress in construction.

Revenue for the period rose 2.8 percent to 978.4 million ringgit from the previous 952 million ringgit due to higher revenue from the real estate division.

The real estate section reported a 24.7 percent rise in revenue to 323.3 million ringgit, thanks to an increase in the number of sales and demand for new affordable homes in Sungai Petani, Kedah.

Scientex is entering the Indonesian market with an affordable housing village called Graha Mustika Tamansari, which will have a value of US$19 million (approximately 85.5 million ringgit).

The settlement, covering 16.1 hectares of land, is located in Bekasi, Greater Jakarta. It will include 400 affordable housing units and is scheduled for completion in 2025.

Scientex is cooperating with Indonesian company Mustika Land and Japanese Creed Group to organize the construction of this village.

The company said recently that its subsidiary Scientex Quatari Sdn Bhd (STX) has entered into a joint venture with PT Graha Mustika Tamansari, a subsidiary of Mustika Land in Indonesia, and Creed Property PH-1 Pte Ltd, a subsidiary of Creed Group in Japan.

PT Graha will own 60% of the shares, while STX and Creed Property will each hold 20%.

According to the documents, the cost of the available houses will be around 500 million rupees, and they will provide modern and comfortable housing for families living in Bekasi, working in the central business district of Jakarta and in the Cikarang-Karawang industrial area.

Lim stated that Scientex will provide its proven experience in creating large-scale settlements at affordable prices based on its own construction technologies.