(DLG MK/BUY/RM1.93/Target: RM2.20)

Dialog’s core FY17 profit is in line. The highlight of 4QFY17 was the strong qoq profit surge in Malaysia operations on the near-completion of Pengerang Phase 2 construction. We have upgraded our profit forecast by 5-6% as we see more upside in the EPCC recognition on Pengerang construction. Phase 2’s startup on 26 August should augur well for the stock. Retain BUY with a higher target price of RM2.20, which includes the monetisation potential to develop the additional phases.

Source: UOB Kay Hian Research - 17 Aug 2017