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Author: sectoranalyst   |   Latest post: Fri, 22 Mar 2019, 9:07 AM

 

Pesona Metro Holdings Berhad - Secures RM238.5mn of Building Job at Cyberjaya

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Secures Main Building and M&E Works

PESONA has accepted a construction job from Lakefront Residence Sdn Bhd, a wholly-owned subsidiary of MCT Berhad, for the main building and M&E works for 3 blocks of residential towers at Cyberjaya. The contract carries a project sum of RM238.5mn, with a construction period of 27 months, commencing on 15 March 2019.

Our View

Assuming a net margin of 4%, we expect the new job to contribute net profit of RM9.5mn, or EPS of 1.4sen/share throughout the construction period.

This is the second job win in FY19, bringing the total YTD job wins to RM647.3mn, exceeding our previous assumption of RM600mn for FY19.

With this job win, its outstanding order book is estimated at RM2.0bn.

Impact

We revise our FY19 order book replenishment assumption from RM600mn to RM800mn, and perform some house-keeping to our earnings model. As a result, we raise our FY19/FY20/FY21 earnings forecasts by 10.9%/25.2%/14.0% respectively.

Valuation

Following the earnings adjustment, we raise the target price from RM0.26 to RM0.27, based on sum-of-parts valuation. Maintain BUY.

Source: TA Research - 15 Mar 2019

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