KUALA LUMPUR (Feb 27): Sime Darby Property Bhd (KL:SIMEPROP) is staying cautious for now, setting a sales target of RM4 billion for 2026 despite higher product launches in the pipeline.

Any revision on that property sales target will only be based on its second-quarter performance, according to Sime Darby Property chief executive officer Datuk Seri Azmir Merican at a virtual post-earnings briefing on Friday. The company sees cost pressures in 2026 spilling over from last year, including raw material prices and other expenses such as on transport, he noted.

“Maybe you say we are a bit more conservative, but we want to be clear that we are pushing,” he said. “Our launch target is higher this year, so we do hope to be more aggressive.”

The cautious tone comes after Sime Darby Property reported a 1.6% year-on-year dip in revenue of RM4.18 billion for FY2025. Still, the company ended the year with record sales of RM4.2 billion.

Shares of Sime Darby Property fell as much as 7% in early Friday trade to an intraday low of RM1.37 before recovering to RM1.43 at noon, still down four sen or a little under 3%. At the last price, the company is valued at RM9.7 billion.

Nevertheless, this year's upcoming projects will carry a higher gross development value of RM4.7 billion compared to properties worth RM3.6 billion launched in 2025, Azmir noted.

Of the total planned launches, 56% will come from township developments, 26% from integrated developments and 18% from international projects in Australia.

As at end-2025, the group's unbilled sales stood at RM3.9 billion, while bookings amounted to about RM1.7 billion as at Feb 15. Unsold completed inventory also remained low at RM191.1 million in gross development value.

“Our inventory of existing stock is low, below 10%,” Azmir said. “That is the discipline we will continue to keep,” he said, stressing that product design, pricing and location remain critical to ensuring healthy take-up rates.

For the company that has about 11,000 acres of land that could be developed into properties worth over RM100 billion, the existing land bank is sufficient to support the group’s medium- to long-term development pipeline, Azmir said.

Any new land acquisitions will be evaluated carefully to avoid overburdening the balance sheet, he added.

As at Dec 31, 2025, Sime Darby Property’s net gearing ratio stood at 35.9%, and the company is still comfortable if gearing rises up to an internal guidance level of about 50%.

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