What the heck .....up few cents for several days......one shot down 11 cents .......buy in bulk under margin financing is going to bleed liao ! Something must be wrong and insider's is disposing with the sudden huge volume .
Both Uzma and Petronas has refuted allegation by Sabah Kini that the company received preferential treatments for their contracts. However, they failed to clarify on the status of the contract “Provision of Hydraulic Work Unit Ghazi 461 for Petronas Carigali”. Sabah Kini claims (with a letter from Uzma to Petronas as proof. Not sure of the authenticity though) that Uzma is facing difficulties with the contract due to the incompatibility of its equipment (of which they had invested around USD8mil) to perform the work specified in the contract. This resulted in delays which give the possibility for Petronas to terminate the contract.
The Ghazi 461 contract was awarded by Petronas on 28th Dec 2017. The contract tenure is until the completion of 3 firm wells (which is now facing delays) with an extension option of a further 2+1+1+1+1 wells (total 6 additional but the company need to complete the first 2 additional wells first before the option of a another well can be given and so forth). The value of the contract is not specified but would most probably constitute a fair chunk of the company’s orderbook of RM1.7bil as of Jan 2019.
In 1Q19, the company only managed to deliver a core net profit of RM500k (excluding the RM6.8mil forex gain) due to an unexpected downtime of its water injection facilities and lower contribution form Uzmapress. Initially, most investors are expecting that the earnings to bounce back for the remaining of the FY19 but given the recent development with the Ghazi 461, earnings might be affected if Petronas decides to terminate the contract. As an example, Uzma might need to impair most of the USD8mil equipment value which was invested specifically for the project.
If you are looking to diversify your portfolio outside of Uzma (due to its earnings and contracts uncertainties) I would recommend you to look at MBMR.
MBMR is a direct proxy to Perodua via its 22.6% interest in the company. Valuation is cheap at only 6.9x PE (based on target FY18 profit of RM145mil. 9m profit is already RM106mil). PB is low at only 0.7x BV. 4Q18 results is expected to be higher than 3Q18 and last year's 4Q17.
FY19 growth will be driven by the still high demand of the new Myvi and the newly launched SUV Aruz and also the newly revamp Alza in 2H19. The recent announcement of closure and potential disposal of the loss-making alloy wheel manufacturing business alone is expected to boost the company’s profit by an additional RM20mil. I am projecting a profit to shareholder of RM170 mil for FY19 which at the current price values MBMR at only 5.9x PE.
Please go through the analyst reports (https://klse.i3investor.com/servlets/stk/pt/5983.jsp) and do your own analysis before making any decisions. There are 8 analysts in total covering the stock with most of them having a TP of above RM3 (all have a buy rating). The average TP for the 8 analysts is around RM3.50.
23 Jan 2019 UZMA KUMPULAN WANG PERSARAAN (DIPERBADANKAN) (185,600 units Disposed) 14 Jan 2019 UZMA KUMPULAN WANG PERSARAAN (DIPERBADANKAN) (157,600 units Disposed) 8 Jan 2019 UZMA KUMPULAN WANG PERSARAAN (DIPERBADANKAN) (891,100 units Disposed) 4 Jan 2019 UZMA KUMPULAN WANG PERSARAAN (DIPERBADANKAN) (38,000 units Disposed) UZMA LEMBAGA TABUNG HAJI (26,263,200 units Disposed) 6 Dec 2018 UZMA KUMPULAN WANG PERSARAAN (DIPERBADANKAN) (17,800 units Disposed) 4 Dec 2018 UZMA KUMPULAN WANG PERSARAAN (DIPERBADANKAN) (182,200 units Disposed)
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Posted by trulyinvest > 2018-12-11 11:14 | Report Abuse
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