1. We initiate coverage on Crest Builder Holdings (CBH) with an OUTPERFORM call and a TP of RM1.49, which provides a total return of 48%.
2. The TP valuation is at a 10% discount to our FD SoP of RM1.67, inclusive of 55% discount on property.
3. CBH is at its inflection point, with rerating catalysts as it moves from its traditional construction business into the property development scene via its Prasarana-awarded redevelopment project of the
Dang Wangi LRT station worth a GDV RM1.0b.
4. This is the first major award from Prasarana's 'rail-plus-property' projects involving a total 40-50 available MRT/LRT station sites.
5. We like CBH for its ability to secure such a catalytic project and expect more to come, which will ultimately propel the company to greater heights as it rides on the ETP play.
6. We expect a 3-year (up to FY14E) CAGR in earnings of 31%.

Source: Kenanga