LogicTrading Analysis

Author: LogicTradingAnalysis   |   Latest post: Mon, 15 Apr 2019, 12:12 AM



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GFM The laggard among ECRL beneficiary.

ECRL and HSR announcement has been long awaited by the investment community where we started to hear about ECRL revival news since March 2019. The whole community had been very excited with this piece of news and it had stir up the investment sentiment for whole construction sector.

This piece of good news is finally confirmed by Tun Daim on 12/4/2019, just 2 weeks ahead of the Belt and Road Submit. Tun Dr Mahathir will be having a press conference by 11 am Monday (15/4/2019). Before listening to Tun M, let’s take a look at the counter that might benefit from ECRL.

I believe most of the investors would like to grab this chance to make some from the ECRL rally, as a result, we had summarise the performance of these counters that might benefit from ECRL. According to the 24 counters mentioned by IB’s which will benefit from ECRL, we had summarise their performance from 4th March 2019 til 12th April 2019. We can see that the top gainers gain about 61% (IWCity gain 72% even it is not a beneficiary of ECRL but HSR), while there is a laggard that only rose 8% til date. You can see the chart below for more details. 


As we can see, most of the small cap had gone up by quite a lot and averagely these counters had gone up by 32%. Among all this small cap, there is 1 that is lag behind had caught our eye, which is GFM that rose only 8.9% since the beginning of March.

Many may ask, how does GFM benefit from this ECRL or HSR thing since they are not construction related counter? We guess this is the major reason that causes GFM to be the laggard.


How does GFM related to ECRL and HSR project?

Before moving further, we can 1st look at HSSEB which is just an engineering consultancy firm, but how do they benefit from ECRL? The reason is, HSSEB is providing consultancy services to the firm and construction of the ECRL and that’s how they benefit from it.

So what about GFM? A little does know, before managing the facilities of the public amenities which is the later stage after the building is built, they do also need professional consultancy firm such as GFM to consult them before they start to build the building which consider as preliminary stage. They couldn’t simply build and ask others to manage, they will need consultancy to consult and advice in order to give the best solution and cost saving to the building owner.


You can see that they do provide such service in their website

Source: http://www.gfmservices.com.my/our-services.php

The best example for this is, most of us do know that Bukit Bintang City Centre is not yet done construction, but why do they need to appoint GFM to be their facility management services provider back in 2017 which is the very beginning stage of the construction?

Source: https://www.edgeprop.my/content/1204404/gfm-inks-deal-uda-provide-management-services-bukit-bintang-city-centre

After appointing GFM for BBCC’s facility management, we can see that UDA still have to appoint GFM for their facility management consultancy job.

Source: https://www.thesundaily.my/archive/gfm-services-uda-secure-rm136-million-bbcc-facility-management-consultancy-job-GTARCH487869

So now you can see why is GFM benefit from ECRL? and it’s not limited only to ECRL but also for HSR as all these public amenities will need GFM for consultation.

As we can see, GFM not only benefit from the beginning of the construction of ECRL but they could also potentially be the facilities management of all the station since they are the one giving consultation and advices.
As a result, they are the biggest winner for the ECRL project, and how can they become laggard when they are 1 of the biggest winner of these Mega project?


Some might still ask, WHY GFM?

The reason is easy, this is because GFM is a Bumi owned company and they have close ties with UDA Holdings which believe to be their partner in this facility management consultancy job. UDA Holding is a subsidiary of Minister of Finance and use to be Tun M’s baby. Hence, how bright is the chance does GFM has in this facility management and consultancy job?

On the other hand, the close ties between UDA Holding and GFM would also indirectly help GFM to participate “Privatisation (Penswastaan)” program which is in plan by the current government.

After so much of explanation, I believe now you are absolutely clear that how GFM will benefit from the Mega project and the reigniting of HSR and Bandar Malaysia project will definitely bring GFM to the moon, who knows they could be the leader in facility management in 3 years’ time. 

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Labels: GFM

Related Stocks

Chart Stock Name Last Change Volume 
GFM 0.515 +0.01 (1.98%) 1,361,000 

  Be the first to like this.
10156838441470042 this counter can fly soon
15/04/2019 12:49 PM
Primeinvestor lol gfm posting just for these gang to get out lo l
16/04/2019 10:22 PM


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