MANAGEMENT DISCUSSION AND ANALYSIS Singapore Construction Sector The Building and Construction Authority (BCA) projects the total construction demand in 2023 (i.e. the value of construction contracts to be awarded) to range between S$27 billion and S$32 billion. The public sector is expected to contribute about 60 per cent of the total construction demand, between S$16 billion and S$19 billion. This is supported by a continued strong pipeline of public housing projects amid Housing Development Board’s (HDB) ramping up of Build-To-Order (BTO) flats supply. Industrial and institutional building construction is expected to contribute strongly to public sector demand, with more projects for the construction of water treatment plants, educational buildings and community clubs. Civil engineering construction demand is anticipated to stay firm with continued support from MRT line construction and other infrastructure works. Private sector construction demand is projected to be between S$11 billion and S$13 billion in 2023, comparable with 2022 figures. Over the medium-term, BCA expects the total construction demand to reach between $25 billion and $32 billion per year from 2024 to 2027. Our subsidiary, SPC Industries Sdn Bhd (“SPC”) has very strong track record in the supply of precast components including TLS, concrete rail sleepers and jacking pipes to large public sector infrastructure projects in Singapore including Singapore MRT projects, Deep Tunnel Sewerage System Phase 2 and Singapore Power’s underground cable tunnel. Further, SPC has been a frequent supplier of IBS components to various projects in Singapore. With its strong track record in Singapore, SPC is well positioned to compete for further potential sales orders from Singapore. Property Development Division The Group’s ongoing development project, namely 100 Trees Private Estate (“100 Trees Project”), which comprises 60 units of semi-detached houses in Bandar Seri Alam, Johor, with estimated gross development value (“GDV”) of approximately RM66 million, is expected to contribute positively to the Group’s revenue and profit, with further construction progress and further sales. The Group expects to launch Phase 2 of the Bukit Bayu Project, which comprises of 16 units of bungalows, with estimated GDV of RM48 million, in the second quarter of 2023. The Group expects to submit its development planning application in relation to few of its land bank for the relevant authorities’ approval this year. Annual Report 2022 26
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