Eastern Housing targets Tk300cr revenue with two housing projects for middle-income group

The Eastern Housing Limited, one of the country's oldest real estate companies, has launched two housing projects in Dhaka for the middle-income people who could not buy high price apartments in the capital.

The company has already commenced the construction work of the two large projects in Dhaka's Mirpur and Chalabon areas, comprising 87 and 283 flats respectively.

In the company's 2019-20 annual report, Eastern Housing Managing Director Dhiraj Malakar said, "With a view to providing affordable apartments for the middle-income group, we have commenced construction work of two projects. We expected that the company will earn Tk300 crore by selling these flats."

However, the company has been giving priority to land projects instead of flats, because they have observed that a large number of flats have remained unsold in Dhaka due to a lack of solvency of the buyers following the Covid-19 crisis.

The Eastern Housing managing director said, "Considering the current situation of real estate business, we strategically focus on more investments in the land projects. But we still have taken the new apartment projects with much caution to protect our investments."

Meanwhile, the company has made all out efforts to get approval of the Rajdhani Unnayan Kartipakkha (Rajuk) for the second and third phases of the Jahurul Islam City at Aftabnagar.

"We are in the process of complying with the regulatory norms of the government in respect of our Mayakanon Land Project at Amin Bazar, which is about 400 acres," said Dhiraj Malakar.

In the second quarter of the fiscal year 2020-21, the company posted 86% growth in revenue of Tk62.25 crore, compared to that in the previous quarter this fiscal year.

At the end of first half of this fiscal year, the Eastern Housing's net profit was Tk18.44 crore and its earnings per share was Tk1.98.

In the April-June quarter last year, when the country faced a 66-day general holiday for the Covid-19 pandemic, the company's year on year revenue dropped by 48%.

Dhiraj Malakar said, "As a consequence of the Covid-19 pandemic we have experienced a considerable fall in the sales of apartments and lands. Moreover, the clients who earlier signed contracts to buy flats and land plots are also making delays in payment of installments."

He also said, "Following the governments' decision to allow investment of undisclosed movable and immovable properties after paying a certain amount of taxes, the real estate sector has received a significant amount of investment."

According to sources at the National Board of Revenue (NBR), 7,445 people have deposited their black money in banks and/or invested in the housing sector. The NBR has received Tk940 crore in revenue from the investment of around Tk10,000 crore in these two sectors.

Meanwhile, the Eastern Housing has paid a 15% cash dividend to its shareholders for the financial year 2019-20, which was the lowest in the last five years.

Listed on the Dhaka Stock Exchange (DSE) in 1994, the company's current paid-up capital is Tk93.34 crore.

The closing price of the company's each share was Tk42.20 on Thursday at the DSE.