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16 December - NWP (5025)     NWP HOLDINGS BHD [Investor Brief : PART 1]

Stock code: 5025 NWP

16 December, Wednesday

Background: since spotting NWP’s turnaround story, I have endeavoured to gain access to its senior management to have some questions answered, especially those of great importance to investors. Through an acquaintance from my previous corporate finance advisory role, I am fortunate to have another mutual connection of his to set up a briefing session over breakfast with NWP.
[Won’t mention names, but thank you guys]

Private Investor Brief by Senior Management
Venue: Café in Bukit Damansara

[ Part 1 ]

Q1: NWP has mostly been in the news for multiple legal suits amongst shareholders and board tussle issues. Have those been resolved?
A: Certainly these sort of news are nothing to be proud of as it does not give confidence not only to investors but our internal staffs too! But we are glad things have settled down with the current board composition. As announced last week, Datuk Seri Nelson is back as Group CEO. The board has also announced that they would make an update announcement on the legal filings on Datuk Seri. In the words of our CEO: steady and ready to go.

Q2: In September, we saw the entry of IT/Tech businessman Datuk Chu as the Exec Director of NWP, and now DS Nelson is back as Group CEO. We all know that DS Nelson is a property man. How is that working out for the company because both are distinct businesses?
A: Great question, and this is where it gets exciting. Yes, property and IT are 2 different sectors. Both the two bosses are experts in their own arenas and together, there are synergies between the 2 of them.

Let me give you an example, with Covid expediting our shift to digitalization and online sales, there is now a growing niche demand for commercial properties specifically designed for online conferencing, online broadcasting, basically for the entire online working space. Traditional developers, without insights from the IT sector, are struggling to update their designs to suit the new landscape. This is where our ED can contribute, to communicate with the property man the latest requirements by online businesses.

While I cannot divulge details of our future projects in the pipeline, I would say the combination of the property and IT experience of our directors makes us a very unique player. So definitely watch out for our upcoming developments.

Q3: Your Group CEO mentioned to the media on NWP’s diversification initiatives into the property business. We all know that the property sector has been battered and soft since a couple years ago. Is now the right time for the company to embark on property?
A: We already had plans to enter into property when Datuk Seri was appointed in end 2016. Perhaps it was a blessing in disguise because now we are entering the market at its bottom, so the only way is to go up. We believe property demand is still be there. We have to be more specific in our offerings to adapt to the latest trends. That is how you capture buyers. Because even in a soft market, property buyers are still buying. They are just more selective and we too, have to be more creative and smart.

Q4: Has the company identified any land to start development on or any projects to takeover?
A: All along we have been studying project candidates because a project would take us quite some time, because of the need to do market studies, land surveys, negotiations between stakeholders etc. But yes, we have identified a few and are in the final stages already. Soon you will hear about it.

[when pressed for further details on the property project]

A: Most likely an industrial development project because when the economy recovers and businesses and factories are looking to expand, that is where the strongest demand will be.

Q5: Market rumour has it that DS Nelson may inject his property agency business into the listed co, and that would make it the first listed property agency firm in Malaysia. Any comments on that because the business is said to be very lucrative?
A: We are not able to comment on the matter for now but yes, the business itself is very attractive. It is an asset-light business that is very much resilient even during the downcycle of the sector. Certainly it has made Datuk Seri enough money to be able to take over a listed company haha.

[Part 2 would be touching on the other new business mentioned which is the automotive biz]

Thank you.

Best regards,
Alpha7 Research

https://klse.i3investor.com/blogs/alpha7research/2020-12-16-story-h1538247521-16_December_NWP_Investor_Brief_PART_1.jsp

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