KUALA LUMPUR, 23 September 2025 — Chin Hin Group Property Bhd has agreed to sell two freehold industrial plots in Johor Bahru for RM19.3 million in cash to Miroad Rubber Industries Sdn Bhd, the company announced in a recent filing with Bursa Malaysia. The deal covers a vacant 1.35-hectare parcel zoned for light industrial use and a 0.89-hectare lot that includes a detached workshop and office, both located in Kampung Kangkar Tebrau.
The disposal price was negotiated taking into account certain physical constraints of the land, notably the presence of a high-voltage pylon and a right-of-way held by Tenaga Nasional Bhd, which reduce the usability of certain portions of the plots. Although the combined market valuation of the two properties was RM28.8 million as of February 2025, the sale price reflects a discount justified by these encumbrances.
Chin Hin acquired the land back in 2012 for RM6.76 million, meaning despite the discount from its valuation, the company stands to realise a substantial gain from the transaction.
Use of Proceeds & Timeline
Proceeds from the sale will be allocated toward several obligations: about RM10 million will be used to repay bank borrowings, RM7.62 million toward working capital, RM1.21 million to cover real property gains tax, and roughly RM477,000 for estimated disposal expenses. The company expects the disposal to complete by June of the following year, assuming there are no unforeseen issues.
Investor Implications and Strategic Context
For investors, the disposal offers clarity on Chin Hin’s strategy for monetising non-core or encumbered assets to strengthen its balance sheet. By converting industrial land assets that have limited potential due to infrastructural constraints into liquid cash, the company improves its debt position and enhances working capital flexibility.
The sale also helps reduce exposure to holding costs and potentially maintenance or tax obligations associated with underutilised land. The fact that the sale price is below valuation but well above the original acquisition cost means Chin Hin still retains a healthy margin, though investors may watch how often the company has to accept such discounts when offloading constrained property.
Risks & What to Monitor
One risk to keep an eye on is whether similar disposals in future may face comparable discounts if land parcels are encumbered or if infrastructure constraints (e.g., pylon, right of way) reduce value materially. Market sentiment may also respond more sensitively to earnings guidance and whether the reduced debt burden leads to improved profitability.
Additionally, timing of the cash flows (especially bank borrowing repayment) will matter — any delays or cost overruns in disposal may affect cash flow forecasts. Also, the broader property market in Johor, industrial land demand, and regulatory approvals can influence revaluation or reuse of remaining land holdings.
