Journey to Wealth
Puncak Niaga - OUTPERFORM - 30 May 2012
Period 1Q12
Actual vs. Expectations
1Q12 results above expectations due to margin improvement across the division and contribution of its new income stream ie: oil and gas.
1Q12 net profit of RM68.4m made up 38% and 55% of our full year FY12 and consensus' forecasts, respectively.
Dividends No dividend declared during the quarter.
Key Result Highlights
QoQ net profit improved significantly from RM8.7m to RM68.4m on the back of 20% drop in revenue. This is mainly due the negative impact to its P&L when Puncak adopted IC12 in FY11. However, the margin in 1Q12 has improved throughout all divisions coupled with progressing earning recognition for its construction contract ie: rural water supply project.
YoY revenue grew by 36% backed by 32% increase in water distribution division due to increase in water tariff and short of oil and gas contribution in 1Q11. The KGL and GOM acquisition was fully completed in 2H11. The net profit has also improved significantly from loss of RM8.1m in 1Q11.
We expect the achievement in 1Q12 results is sustainable throughout FY12.
Outlook The Oil and Gas division remained as the key rerating catalyst for Puncak which could surprise on the upside in terms of the size of order book replenishment in FY12 ie: >RM550m.
We expect more meaningful negotiation between SSG and Puncak on water assets consolidation post-election.
Change to Forecasts
We tweaked our FY12E and FY13E net profit higher by 29% and 25%, respectively. We fine tuned our assumption on oil and gas order book assumption higher from RM300m to RM550m for the next 2 years.
Rating MAINTAIN OUTPEFORM
Maintain OUTPEFORM recommendation with higher Target Price of RM3.01 (RM2.70 previously) based on SOP valuation.
Valuation We raise our target price higher to RM3.01 based on SOP valuation.
Risks Prolonged water consolidation issues
Source: Kenanga
Related Stocks
| Chart | Stock Name | Last | Change | Volume |
|---|
Market Buzz
More articles on Journey to Wealth
Ekovest: No plan to launch another offer for Iskandar Waterfront City
Created by kiasutrader | Mar 29, 2018
Kenanga Research - On our Portfolio - Parliament dissolution around the corner?
Created by kiasutrader | Mar 25, 2013
Plantation Sector - Proposed accounting standard scrapped OVERWEIGHT
Created by kiasutrader | Mar 25, 2013
Pavilion Reit - Limited upside, earnings upside have been priced in HOLD
Created by kiasutrader | Mar 25, 2013
Discussions
Be the first to like this. Showing 0 of 0 comments
Post a Comment
Featured Posts
Latest Videos
Apps
Top Articles
1
2
4
save malaysia!
Visa-free travel to China extended for Malaysians to 30 days
5
6
7
Good Articles to Share
8
Good Articles to Share
Four convicted in Spain over homophobic murder that sparked nationwode protests
#
Stock
Score
Daily Stocks
Stock Name
Last
Change
Volume
Stock Name
Last
Change
Volume
Stock Name
Last
Change
Volume
Featured Advertisers / Partners
Ride The Bull Short The Bear
CS Tan
4.9 / 5.0
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
