Dayang Enterprise; Buy; RM5.35
Price Target: RM5.90; DEHB MK

DEHB has proposed to undertake a bonus issue of up to 275m shares on the basis of 1 bonus share for every 2 existing DEHB shares. The proposed bonus issue, expected to be completed by 1Q14, will be capitalised from the company’s share premium and retained earnings account. Meanwhile, its share base will increase to 825m upon completion of the deal. There is no impact on its earnings or valuations.

We continue to like DEHB for its clear earnings visibility, solid balance sheet (RM19m net cash) and good execution track record. Its record high c.RM5bn order book will keep the company busy for the next five years and transform the O&G niche service provider into one of the largest in Malaysia. Reiterate our Buy rating with RM5.90 TP (based on 15x FY14 EPS). 

Source: HwangDBS Research - 9 Dec 2013