First to benefit is Gamuda and Kps, kps will move very Fast because only 500m outstanding shares with KDEB holding 60%. Small Replacement pipe( plastic) will be Sapu by Kps and only Big steel pipes are availble for engtex. Big pipes need Big money. Hard to find budget
It because splash deal (selling price) still a rumour. One confirm deal than will have first wave Second wave will be on Oct or early (announce of water contract )
The aged underground domestic water pipes replacement work has been long overdue. In this coming budget, a sizable allocation would be made for the project. Engtex will be the biggest beneficiary of the probable project.
I strongly believe ductile iron pipe will be phase out in the near future and superseded by new technology like pvc o pipe , that said I will invest in fitters rather than engtex. just my opinion .
The ductile iron pipes have a lot of advantages as compared to PVC-O pipes.
1) Big ductile iron pipes (800mm to 1200mm) are available whereas such sizes are not available for PVC-O pipes. 2) Ductile iron pipes have higher tensile strength. 3) Ductile iron pipes are easier and more cost effective to do tapping. 4) PVC-O pipes deteriorate under sunlight (ultraviolet) and certain corrosive soil conditions.
According to an article from The Star, Engtex has already secured renewable two year supply contract from Pengurusan Aset Air in seven states. The article was dated 9/7/2018.
I believe Engtex, Fitters and a few other pipe suppliers will be benefitted. The quantities of pipe needed are very huge, 44,000km in total. In anticipation of huge demand increase, Engtex is well prepared and has already invested heavily in new production lines to meet the upsurge in demand from the pipe replacement.
The pipe replacement is top urgent because a lot of the existing asbestos cement pipes are leaking. Asbestos cement pipes are phased out because their lifespan is short.
All companies with political connections during BN era are languishing. When the pirates were in, the crooks were having a field day. Now they have to do genuine business.
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Posted by skyrocket > 2018-07-12 18:30 | Report Abuse
http://www.theedgemarkets.com/article/engtex-seen-gain-better-water-industry-outlook
Target RM1.37