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Figure 1.0: Company logo of EcoFirst Consolidated

For those unfamiliar, EcoFirst Consolidated Berhad (KLSE: ECOFIRS) has been a staple on Bursa Malaysia's Main Board since 1984. The company is engaged in property development, investment holding, and management. Let's delve deeper into its various business segments and recent developments that make it a stock worth watching.

Property Development

EcoFirst's property development segment includes notable projects such as Liberty @ Ampang Ukay, with upcoming phases, and Upper East @ Tigerlane. The company also owns South City Plaza, a leisure shopping mall.

Figure 2.0: Snapshot of KL48 project

In FY2023, EcoFirst recorded a revenue of RM15.4 million, largely due to the successful launch of the KL48 project in Kuala Lumpur. This project spans 1.61 hectares of freehold land in the Jalan Chan Sow Lin area and has a gross development value (GDV) of RM1.0 billion, promising significant contributions to the company in future financial years. Beyond KL48, EcoFirst plans to continue launching projects in Ampang Ukay as part of their 10-15 year flagship development strategy.

Asset ownership model

ECOFIRS also owns South City Plaza in Seri Kembangan, which provides a steady stream of recurring income. In FY2023, this property investment segment contributed RM13.4 million to the company's total revenue, thanks to an improved occupancy rate of 86.0%. For FY2024, this asset is expected to perform well, bolstered by increased retail spending from the introduction of EPF Account 3, which is projected to generate RM20.0 billion to RM25.0 billion in spending power.

Property Management

The company also manages South City Plaza, overseen by Budaya Fokus Sdn. Bhd., contributing RM2.6 million to the company's revenue in FY2023.

Emergence of new substantial shareholder

The spotlight is now on EcoFirst due to the emergence of a new substantial shareholder.

Figure 3.0: Shareholding changes of ECOFIRS

Recently, Mr. Chew Hian Tat, a substantial shareholder of Central Global Berhad (KLSE: CGB), acquired approximately 6.41% of EcoFirst. The company has not conducted asset revaluation for an extended period, suggesting potential value unlocking in the near future.

Figure 3.1: Share price performance of CGB and ECOFIRS

Given the success of CGB following Mr. Chew's involvement, EcoFirst might replicate this pattern. Investors might find this an opportune time to consider investing in EcoFirst.

Conclusion

With strong fundamentals, strategic asset ownership, and the recent emergence of a significant shareholder, EcoFirst Consolidated Bhd. appears to be on a promising trajectory. The company’s diverse portfolio and potential for value unlocking make it an interesting prospect for investors. As EcoFirst continues to develop its flagship projects and enhance its recurring income streams, it’s worth keeping an eye on this stock.

Disclaimer

The information provided in this article is for educational and informational purposes only and should not be considered financial advice. Investing in stocks involves risks, including the loss of principal. Always conduct your own research and consult with a qualified financial advisor before making any investment decisions. The author holds no responsibility for any investment decisions made based on the information provided.