Return of the King – AGESON BERHAD (7145)

To all the supporters of AGES, we understand that previously there had been some bad mouthing on the company due to the Writ & Statement of Claim letter issue by RHB. I had told investors time and time again that the issue will resolve as this is not a proper way for a bank to claim the money like that, unless these greedy bunch of people is aiming for the landbank which is under the encumbrance and pledged under the RHB loan, anyway, we all know how bank works.

Now, dated 4^th January 2021, AGES had made an announcement to inform all investors that they had reached a mutual consensus with RHB that the issue had been process to be held in abeyance, or in plain language, they indefinitely delayed the litigation issue.

Looks like someone’s backing out?

Here’s the link of the announcement:  https://www.bursamalaysia.com/market_information/announcements/company_announcement/announcement_details?ann_id=3118331

No matter. I believe this announcement would boost investor’s confidence in AGES, furthermore, the stock price did not drop even in today’s ultra-red market, with 934 counters down in the first trading day of 2021, not actually a good start, ay?

To further strengthen my shareholding in AGES, they did announce another good news, in which they signed a Development Rights Agreement (“DRA”) with MBI Perak. For those who do not know, MBI Perak is a corporate owned under the state Government of Perak which they are principally involved in the development of mineral, assets as well as resources.

MBI Perak has agreed for a 75% owned subsidiary under AGES, which is AGESON HOLDINGS SDN BHD (“AHSB”) to develop a piece of land which is approximately 475 acres, located in Wilayah Sungai Kelian Baru (Which I had fact checked the area, they are selling terrace for around RM 1.3 Million).

This development is positioned as a mixed development, in which government agencies, administration units, industrial units, commercial units and even residential units will be developed.

For normal investors like us, we may read the DRA as a joint venture between MBI Perak and AHSB. AHSB in return will pay MBI Perak 20% of the Gross Development Value (“GDV”) as a return for giving AHSB the development rights of the piece of land bank. And this is actually a common way of joint venture in the market, just in case if you are not from property & construction background.

The whole GDV would be approximately RM 1.24 Billion, comprising:

(i) 365 units of shop offices;

(ii) 1,038 units of terrace houses;

(iii) 332 units of semi-detached houses;

(iv) 191 units of detached houses,

(v) 33 units of industrial lots;

(vi) 1 unit of District Council office;

(vii) 1 unit of District and Land Offices;

(viii) 1 unit of District Health Department office; and

(ix) 1 unit of Community Development Department Tapah office.

And the profit from the project would be approximately RM 310.6 Million for AHSB, based on the current annual profit of AGES, this would definitely be a super profit booster in the upcoming financial years!

You may read the remaining details of the announcement here: https://www.bursamalaysia.com/market_information/announcements/company_announcement/announcement_details?ann_id=3118329

To conclude, AGES is now free from all those annoying issues that are blocking the share price from moving. With the inclusion of the new DRA, I believe AGES will shine for the next few years!