Eversendai Corporation (ECB)announced that it had been appointed as a subcontractor to erect structuralsteel works worth SAR193m (c. RM158m) for the railway station in the King AbdulAziz International Airport Development Project - Phase 1 in Jeddah, Kingdom of SaudiArabia. The project was awarded by the Saudi Binladin Group Architecture &Building Construction Division. It is expected to be completed by 2013. We are keepingour FY11-FY12E earnings forecasts of RM110mRM121m unchanged as we have factoredin c.RM1.0b order book replenishment and this contract is within that expectation.We have a NOT RATED rating on Eversendai for now as we have yet to formallycover the stock. Our fair value for the company however remain unchanged at RM2.19based on 14x PER on its FY12E EPS.

More new awards from the Middle East.  Eversendai Corporation Berhad (ECB) announcedthat Eversendai Engineering LLC in Dubai, a wholly owned subsidiary of ECB, hadbeen appointed as a subcontractor to erect structural steel works worth SAR193m(c. RM158m) for the railway station in the King Abdul Aziz InternationalAirport Development Project - Phase 1 in Jeddah, Kingdom of Saudi Arabia. Theproject was awarded by the Saudi Binladin Group Architecture & BuildingConstruction Division. This project is expected to be completed by 2013 and it willuse c.12,000 tonnes of steel. 

Strong order book of RM2.3b. As at YTD, ECB's current order bookhas increased by the RM158m above to RM2.3b (+7%). This new contract is withinour expectation as it is part of the company's c.RM1.0b order bookreplenishment, which is based on a 20% success rate of its total tender bookvalue of c.RM12.0b. Main income from Middle East. We understand that ECB has alsobid for other jobs such as the Abu Dhabi airport expansion and Capital Gate,which is part of the Abu Dhabi National Exhibition Center. With about 60% ofECB's income coming from the Middle East now, the company  is moving its focus to India given thepotential market in that country. To date, the company is doing c.RM350m worthof works in India. 

Valuation.  We are keepingour  fair value on Eversendai unchangedat RM2.19  based on 14.0x PER of its FY12earnings.  However, we have a  NOT RATED rating on the company  for now  as  we have  yet  to initiate  formal  coverage on the stock.