WCT has bagged a MYR652m building job for a new Ikano mall in KL. Nonetheless, we still think WCT is not an ideal proxy to the buoyant construction sector as it is not involved in the Klang Valley MRT project. Also, its property business is facing headwinds on the back of the various sector cooling measures. We maintain our NEUTRAL call, forecasts and TP of MYR2.31 (16x FY15F EPS, 10% upside). 
 
Second key job win in FY14. WCT has secured from Boustead Ikano SB a MYR651.6m contract for the construction of a new Ikano shopping mall along Jalan Cochrane in KL. This is the second key contract WCT has won in FY14, boosting its YTD contract wins to MYR994m and its outstanding construction orderbook by 22% to MYR3.7bn (see Figure 1). Assuming an EBIT margin of 5-7%, the contract will fetch MYR32.6-45.6m in EBIT over the contract period ending 2H16.   

No change to forecast.  We maintain our forecast, which already assumes contract wins worth MYR1.5bn in FY14.

Risks to our view. These include: i) contract wins in FY14-15 falling short of our assumption of MYR1.5bn per annum, ii) higher-than-expected input costs, and iii) weak demand for its property launches.

Maintain NEUTRAL. The prospects for the construction sector are strong, underpinned by the MYR73bn Klang Valley MRT project which will keep industry players busy until 2021. However, WCT is not a good proxy to the construction sector, as it has yet to secure any work packages from the Klang Valley MRT project. In addition, its property business is facing headwinds on the back of the various sector cooling measures introduced by the Government. Our TP remains at MYR2.31 based on a 16x fully-diluted FY15F EPS of 14.5 sen, in line with our benchmark 1-year forward target P/Es of 10-16x for the construction sector.

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Source: RHB