RML Analyzes Real Estate in 2021: Slowdown but Confident in Maintaining Luxury Market Leadership

Highlighting Rebranding Strategy with a Focus on Online Sales via O2O

RML provides an overview of the real estate market in 2021, which is experiencing a slowdown. However, the company is confident in maintaining its leadership in the luxury real estate sector by implementing a rebranding strategy aimed at reaching the younger generation and focusing on online sales through O2O methods to stimulate demand. Additionally, there are plans to launch a new project on Sukhumvit 38. In terms of performance for 2020, the company reported revenue of 3,171.5 million baht from luxury condominiums such as The Diplomat 39, The Lofts Asoke, and The Lofts Silom.

Mr. Korn Narongdej, CEO of Raimon Land Public Company Limited (RML), stated that despite the overall real estate market facing negative factors due to the COVID-19 pandemic, which has led to a global economic slowdown, the company believes it can continue to lead in the development of luxury real estate.

The operational plan for this year includes a rebranding effort to enhance the company's image, making it more accessible and modern, aligning with Raimon Land's new vision to expand its target audience to include the younger generation and all demographics with purchasing power in the upper market. This brand image adjustment is expected to bring a new dimension to operations by improving the quality of condominiums and services, incorporating modern innovations into all processes, and creating a positive experience for customers.

Furthermore, the company plans to promote sales through special pricing promotions and focus on online sales using the O2O (Online to Offline) strategy, allowing customers to view luxury projects online before deciding to visit the actual project, thereby stimulating purchase demand and reaching customers directly. This is expected to drive project sales significantly.

Additionally, the company plans to launch a luxury condominium project on Sukhumvit 38, which is the third joint venture project between the company and Tokyo Tatemono. The Grade A office building project, One City Centre (OCC), is currently under construction, with a joint venture ratio of 60:40 between the company and Mitsubishi Estate Asia.

For the financial performance in 2020, the company reported total revenue of 3,171.5 million baht, a decrease of 448.9 million baht from the previous year, which had total revenue of 3,620.4 million baht, representing a 12.4% decline. The presales amounted to 3,045.5 million baht, an increase of 136.5 million baht or 4.7% from the previous year, due to ongoing promotional campaigns offering special prices to customers in Thailand, in line with the policy to focus on increasing revenue and maintaining a stable cash flow. The company has also sold units in completed condominiums ready for occupancy, such as The River, The Diplomat 39, The Diplomat Sathorn, The Lofts Asoke, and The Lofts Silom.

In the fourth quarter of 2020, the company reported revenue of 666.1 million baht, an increase of 167.1 million baht from the previous year, which had total revenue of 499.0 million baht, representing a 33.5% increase. The presales were 588.2 million baht, an increase of 70.5 million baht from the previous year's 517.7 million baht, or an increase of 13.6%, due to promotional campaigns for The Lofts Silom project targeting both domestic and international customers.

In 2020, the company reported a net loss from operations according to the consolidated financial statements of 724.4 million baht, a decrease of 784.3 million baht from the previous year's net profit of 59.9 million baht, resulting in a net loss per share of 0.172 baht. The higher-than-normal loss was partly due to recording a total loss of 250.2 million baht from the sale of land on Sukhumvit 19, which was originally under an EIA application for the construction of a 4-star hotel. However, due to unfavorable economic conditions and the impact of COVID-19, which has halted global tourism and is expected to take 2-3 years to recover, the company decided to sell the land quickly to improve its cash flow. Excluding this special item, the company would have reported a net loss of 474.2 million baht for the year.

As of December 31, 2020, the company had a backlog of sales waiting to be transferred amounting to 6,565.2 million baht across a total of 7 projects, including the Tait12 project at 39.2%, The Estelle Phrom Phong at 34%, The Lofts Silom at 15.6%, The Lofts Ratchathewi at 9.8%, along with The Lofts Asoke, The River, and Unixx South Pattaya at 1.4%.