(VSI MK/BUY/RM2.37/Target: RM2.80)

Although VSI has risen 68.1% ytd, we believe there is still further upside to share price on: a) potential contracts from a key customer given its VI status, and b) prospective projects from 43.5%-owned VSIG. The next earnings surge should be in 2HFY18 on order pick-up from the commencement of contracts for new launches by a key customer. Maintain BUY with a higher target price of RM2.80, based on 14x fully-diluted FY19F PE.

Source: UOB Kay Hian Research - 7 Sept 2017