Price Target Analysis: MUHIBAH (5703)

Good Morning Friends & Gentlemen!
Dow Jones is now at Record High! A PBT of RM78.5 million and Order Book of RM1.632 Billion is announced by Muhibbah for current Qtr, A Rebound is Coming Soon! Once Muhibbah exits Penny Stock Status, Muhibbah will be re-rated with more Foreign & Institutional Fund Buyers, soft target 1.25 with TP 1.34!

Recommendation:
Accumulate on any Weakness!

MUHIBBAH ENGINEERING (M) BHD

REVIEW OF GROUP PERFORMANCE (YTD 2024 vs. YTD 2023)
The Group reported higher consolidated revenue with higher profit before tax of RM78.5 million for the financial period ended 30 June 2024 as compared to consolidated revenue of RM694.9 million and profit before tax of RM23.1million respectively for the corresponding period ended 30 June 2023.This improvement in both Group revenue and Group profit before tax are mainly contributed by Concession division and better performance of Marine Shipyard and Infrastructure Construction divisions.

COMPARISON WITH PRECEDING QUARTER RESULTS (Q2 2024 vs. Q1 2024)
The Group reported higher consolidated revenue of RM728.0 million ascompared to RM413.9 million in the preceding quarter mainly due to higher revenue from all divisions.This quarter reported higher profit before tax of RM47.5 million as compared to RM30.9 million in the preceding quarter mainly due to better performance from Infrastructure Construction, Marine Shipyard and Concession (Airport).

GROUP'S PROSPECT
Secured Order Book As at 22 August 2024, the Group's total outstanding secured order book in hand for the construction and cranes division is RM1.623 billion.

Prospect
The regional infrastructure and oil & gas industry are seeing more capital investments in near future which is a boon for the Group's business moving forward.

2024-08-30 08:59

even with a good quarter, muhibbah is still a penny stock. waiting for the sharks to see the value.

2024-08-30 12:07

That's why the Recommendation is Accumulate on Weakness before the Sharks & Foreign Funds come! Now only nibbling, more chance to grab while still penny stock & we wait for the Breakout!

2024-08-30 13:16

Muhibah’s 24Q2 result

1. Crane segment (Favco)
- accidentally lower earning from crane business as lack of one off gain, eg forex (24Q2 -1.5m vs 24Q1 +4.1m / 23Q2 +7m)
- If take off all the one off items, the core PBT in 24Q2: 14.9m vs 24Q1: 14.7m / 23Q2: 7m

2. Concession segment (mainly from airports)
- Recorded PBT 16.9m in 24Q2 (+40.6% compare 24Q1 / +77.2% compare 23Q2)
- Surprising good as Q2 & Q3 used to be low travel season in Cambodia
- Passengers in 24Q2 recorded 1.136m (+13% compare 23Q2)
- Passengers in July continue growth with +23% y-y

3. Infrastructure Construction segment
- reported PBT 40m (compare 8.7m in 24Q1 / loss 1m in 23Q2)
- highest quarter profit since 2018

Overall fantastic result.
But concern of order-book replenish as year-to-date yet to get any award.

2024-08-30 13:56

Yes!
GROUP'S PROSPECT
Secured Order Book As at 22 August 2024, the Group's total outstanding secured order book in hand for the construction and cranes division is RM1.623 billion.

Prospect
The regional infrastructure and oil & gas industry are seeing more capital investments in near future which is a boon for the Group's business moving forward.

2024-08-30 14:14

gndthx

CIMB Analyst report 29.08.24
https://rfs.cgsi.com/api/download?file=ae6d1589-9311-44b2-8be5-379acfc63b75

2024-08-30 14:43

Base on CGS/Cimb report, Q1 oni achieve 10% of full year consensus profit base on Tp 1.34.

Q2 now alrdy climb back 50%.

Q4 use to be strongest in history trend (in term of core profit)

High chance to exceed their full year consensus profit then. Raise TP !

2024-08-30 15:05

base on past 2 years history, Muhibah used to clinched in contracts during the year end:

RM 479m award in 2023 Nov
RM 438m award in 2022 Dec

2024-08-30 15:13

sirM4KU

return of muhibah

2024-08-30 19:43

Time to accumulate!

2024-09-02 10:50

return of muhibbah? you sure or not sirM4KU? 😁🚔

2024-09-03 10:47

after a week, muhibbah is dropping even further. where are the so-called accumulators? LOL

2024-09-11 09:52

The outstanding Regulated Short Selling (RSS) has reduce to 1,559,400 unit now~ compare peak at 2,935,200 during mid Sep.

The lowest since end of July crash~

2 months ago

No difference. Still a penny stock.

2 months ago

多家航空公司计划开通直飞柬埔寨航线
https://www.jianhuadaily.com/20240927/256889

2 months ago

Be patience guys! Time to accumulate!

2 months ago

time to accumulate again? accumulating since 2020 leh. how long more? hahahaha

2 months ago

Bettyem

Go Muhibbah Go!

24Q3金边机场抵达航班数量增至4,717架次。

平均每周 363 趟航班。

旅游旺季回来，第四季度将更加精彩！

第 4 季度第一周航班数量跃升至 381 架（行动管制令以来的最高数量）

24Q1：356 航班/周
24Q2：356 航班/周
24Q3：363 航班/周

2 months ago

Morning Friends & Gentlemen! Accumulate before news is out!
Muhibbah Engineering (M) Bhd is expected to benefit from a tourism recovery in Cambodia, analysts say.

The company owns a 21% effective stake in Cambodia Airports which manages two operating airports in Cambodia.

It is also likely to clinch more Petroliam Nasional Bhd (PETRONAS) jobs via its PETRONAS fabrication licence, CGS International Research (CGSI Research) said in a report.

“We hosted a meeting with Muhibbah’s management on Sept 12 and in our view, the key takeaway is possible large lumpy wins after a lull,” the research house said.

It noted Muhibbah’s order book for construction and cranes remained resilient at RM1.6bil as of Aug 24, albeit down from its recent Nov 23 peak of RM2.4bil.

“It has yet to win any material contracts this year but has submitted a large tender for an engineering, procurement, construction and commissioning role for the Lang Lebah gas field in Sarawak.

“Given its prior experience with similar projects in Gansar, Bekok and Bindu in Terengganu, we see it being a frontrunner for this project,” the research house said.

CGSI Research said that passenger arrivals at the two Cambodian airports rose 18% year-on-year (y-o-y) to 2.3 million in the first half of 2024 (1H24), and should hit five million for the entire year.

The research house added that Cambodia Airports accounted for most of Muhibbah’s 1H24 associate profits, which rose 63% y-o-y to RM30mil.

“This is commendable as 1H23 included the Siam Reap airport concession. “

Citing The Khmer Times, the research house said the construction of Techno International Airport in Kandal, near Phnom Penh was 80% complete and will open in mid-2025, replacing the current Phnom Penh airport.

“We maintain our view that the most likely scenario involves Cambodia Airports receiving compensation for investment incurred until the Phnom Penh airport concession is surrendered and that it will be engaged to operate the new airport at Kandal, based on a fixed-fee structure and with some element of profit sharing,” the research house said.

While it said it liked Muhibbah for its cheap valuation at next year’s financial year price-earnings ratio of eight times versus the sector’s 17 times, it noted key downside risks were the non-continuity in earnings delivery and higher raw material costs.

Re-rating catalysts for the company include better earnings delivery and stronger tourist arrivals in Cambodia, the research house said.

https://www.thestar.com.my/business/business-news/2024/09/23/muhibbah-to-ride-on-tourism-recovery-in-cambodia

2 months ago

Muhibbah is also likely to clinch more Petroliam Nasional Bhd (PETRONAS) jobs via its PETRONAS fabrication licence, CGS International Research (CGSI Research) said in a report.
https://www.upstreamonline.com/field-development/petronas-unveils-platforms-bonanza-for-malaysian-projects/2-1-1575593

2 months ago

Muhibbah Engineering Bhd
Target price: RM1.34 ADD

CGS INTERNATIONAL (SEPT 17): The key takeaway from a recent meeting with Muhibbah’s (KL:MUHIBAH) management is possible large lumpy wins after a lull. Muhibbah’s order book (construction and cranes) remains resilient, at RM1.6 billion as at August 2024, albeit down from its recent November 2023 peak of RM2.4 billion.

It has yet to win any material contracts this year but has submitted a large tender for an engineering, procurement, construction and commissioning (EPCC) role for the Land Lebah gas field. Given its prior experience with similar projects in Gansar, Bekok and Bindu in Terengganu, we see it as a frontrunner for this project. We are also encouraged that its construction earnings delivery has picked up strongly in 2Q24, driven mainly by its EPCC and installation role for the Gansar project for Petronas Carigali.

We like Muhibbah for its cheap valuation at FY25F PER of eight times (versus the sector’s 17 times) and for being a proxy for a recovery in tourist arrivals via Cambodia Airports, while its Petroliam Nasional Bhd fabrication licence should enable it to clinch more Petronas jobs, in our view. Key downside risks are non-continuity in earnings delivery and higher raw material costs.

https://theedgemalaysia.com/node/727766

2 months ago

Trading View, Recommends a Very Strong Buy at current low price!
https://www.tradingview.com/symbols/MYX-MUHIBAH/

2 months ago

Analysis By Foreign Analyst.
Muhibbah Share Price vs Fair Value
What is the Fair Price of MUHIBAH when looking at its future cash flows? For this estimate we use a Discounted Cash Flow model.

51.8% Undervalued
Current Price RM 0.93
Fair Value RM 1.92

REWARDS:
#Trading at 51.8% below our estimate of its fair value
Earnings are forecast to grow 31.83% per year
#Became profitable this year
RISK ANALYSIS:
#No risks detected for MUHIBAH from our risk checks.

2 months ago

https://www.klsescreener.com/v2/news/view/1407909

According to Wall Street analysts, the average 1-year price target for MUHIBAH is 1.295 MYR with a low forecast of 1.212 MYR and a high forecast of 1.407 MYR.

Lowest
Price Target 1.212 MYR
31% Upside
Average
Price Target 1.295 MYR
40% Upside
Highest
Price Target 1.407 MYR
52% Upside

https://www.alphaspread.com/security/klse/muhibah/analyst-estimates

2 months ago

minichart

https://www.minichart.com.sg/2024/10/11/muhibbah-engineering-breaks-out-gearing-up-for-further-upside/

CGS International recommends a Technical Buy for Muhibbah Engineering. The stock recently surged, breaking out of a downtrend, underpinned by a long white candle and closing above key exponential moving averages (EMAs). This indicates a bullish shift in momentum.

Entry Price Range: RM0.90 to RM0.925
Stop Loss Level: RM0.83
Target Price 1: RM0.96
Target Price 2: RM1.03

Thank you

2 months ago

Bettyem

2 months ago

RSS outstanding has reduce to 755,200 now;
compare peak at 2,935,200 one month ago

2 months ago

sailang_now

Morning Guys, Don't Miss!
Buy on any dips as Muhibbah already broken Resistant 0.96 and reached RM0.965, with positive momentum!. Market should retest 0.96~0.965 again?, it's expected to exit penny stock and retest Resistant RM1.03 soon! Further upside is expected for a post Budget rally in anticipation of good news, contract win from Petronas & Lang Lebah gas field in Sarawak? Next Resistant is RM1.03, followed by Resistant RM1.10 ~1.31 with Target Price RM1.34!...tut tut

Target Price 1.34
Resistant 1.31
Resistant 1.24
Resistant 1.17
Resistant 1.10
Resistant 1.03
Resistant 0.965
Price 0.94
Support 0.925
Verdict: Positive Momentum is Confirmed!

Note:
Based on 2 years historical contract wins, Muhibah contract award for Nov/Dec. 2024 from Petronas/Lang Lebah Sarawak Gasfields could exceed RM527m based on expected 10% annual increase on CAPEX spending by bullish Oil & Gas Players?

Quote:

"ValueMaker

Based on past 2 years history, Muhibah used to clinched in contracts during the year end:

RM 479m award in 2023 Nov
RM 438m award in 2022 Dec"

Neom Project, Cambodian Airport & Petronas Projects Beckons?

https://klse.i3investor.com/web/blog/detail/cgscimbresearch/2024-02-27-story-h-187496462-Muhibbah_Engineering_4Q23_Kitchen_Sinking_Improved_Core_Earnings

https://www.businesstoday.com.my/2024/09/18/muhibbah-set-for-large-construction-and-crane-jobs/

1 month ago

Morning Friends & Gentlemen!

CGS Analysis on Muhibah. Accumulate on any weakness!

Possible large construction and crane wins
■ Possible large construction and crane wins on the horizon
■ Cambodia Airports working towards a win-win outcome by 2Q25F
■ Valuations remain cheap at FY25F P/E of 8x (vs. sector average of 17x); Up/downside: 64.4%reiterate Add, with an unchanged SOP-based TP of RM1.34

Construction earnings picking up, bidding for large projects. We hosted a meeting with Muhibbah’s management on 12 Sep 24. In our view, the key takeaway is possible large lumpy wins after a lull. Muhibbah’s orderbook (construction and RM593.8mcranes) remains resilient, at RM1.6bn as at Aug 24 (Fig 5), albeit down from its recent peak of RM2.4bn. It has yet to win any material contracts this year but has submitted a large tender for an EPCC role for the Land Lebah gas field. Given its prior experience with similar projects in Gansar, Bekok and Bindu in Terengganu, we see it being a frontrunner Free float: 73.3%for this project. We are also encouraged that its construction earnings delivery has picked up in strongly in 2Q24 with pretax profit of RM40m (2Q23: RM1m pretax loss) driven mainly by its EPCC and installation role for the Gansar project in Terengganu for Petronas CarigaliKey changes in this note(RM400m-500m remaining, including additional scope of RM318m awarded in late-2023). We raise FY24F/FY25F/FY26F EPS by 5%/4%/2% to account for additional scope Muhibbah’s value proposition is not in government infrastructure or the data centre space for its engineering, procurement, but more in marine-based construction and offshore platforms leveraging on its Petronas construction and commissioning (EPCC) job fabrication licence, in our view. Its crane business under Favelle Favco has been invited to for the Gansar project, and EPCC and tender for the supply of tower cranes for the world's biggest construction project known as installation of Bindu A (jacket and topside)Neom in Saudi Arabia; the tender will close at end-Sep 24 with a potential award by early next year. Another key division within its infra segment is CiTech, a supplier of waste heat recovery units (WHRUs) with an orderbook of RM25m and tenderbook of RM1.1bn as at Aug 24. CiTech’s clientele includes Petronas Carigali, Siemens and Keppel.

Working towards a win-win outcome for Cambodia airports. Muhibbah owns a 21% effective stake in Cambodia Airports, which manages two operating airports in Cambodia – in Phnom Penh and Sihanoukville. Passenger arrivals to the two airports rose 18% yoy to 2.3m in 1H24, and should hit 5m for 2024F, in our view. Cambodia Airports accounted for most of Muhibbah’s 1H24 associate profits, which rose 63% yoy to RM30m; this is commendable as 1H23 included the Siam Reap airport concession. The Khmer Times on 3 Sep 24 highlighted that construction of Techno International Airport in Kandal, near Phnom Penh was 80% complete and it will open in mid-2025F, replacing the Phnom Penh airport. We maintain our view that the most likely scenario involves Airports receiving compensation for investment incurred until the Phnom Penh airport concession is surrendered and that it will be engaged to operate the new airport at Kandal, based on a fixed fee structure and with some element of profit sharing.

Reiterate Add and SOP-based TP of RM1.34. We like Muhibbah for its cheap valuation at FY25F P/E of 8x (vs. sector of 17x) and for being a proxy for a recovery in tourist arrivals via Cambodia Airports, while its Petronas fabrication licence should enable it to clinch more Petronas jobs, in our view. Key downside risks are non-continuity in earnings delivery and higher raw material costs. Re-rating catalysts include better earnings delivery and stronger tourist arrivals in Cambodia.

1 month ago

Morning Friends & Gentlemen! If you have missed CTOS, don't miss Muhibah! Be Greedy when others are Fearful. Accumulate on current weakness and let's wait for the Rebound!
https://www.thestar.com.my/business/business-news/2024/09/23/muhibbah-to-ride-on-tourism-recovery-in-cambodia

1 month ago

Phnom Penh airport recorded total 395 arrival flights this week~ the highest number since MCO !

** the 2nd highest number was recorded in first week of Oct as 381 arrival flights

Compare with:
24Q1: average 356 flights / week
24Q2: average 356 flights / week
24Q3: average 363 flights / week

Q4 number looks encouraging~

1 month ago

curiousq

Value investment opportunity emerges 😗
Goog buy now !!!

1 month ago

Patiently wait for Q3 result

1 month ago

Cambodia’s airports record 21 percent rise in passengers

https://www.khmertimeskh.com/501594562/cambodias-airports-record-21-percent-rise-in-passengers/

1 month ago

FAVCO 24Q3 result:
If exclude the one off items (eg: forex, allowances, derivatives & etc), core PBT stood as:

24Q3: 27.231m
24Q2: 14.863m
24Q1: 14.686m

23Q4: 50.988m
23Q3: 22.040m
23Q2: 7.088m
23Q1: 9.994m

Forex loss of RM 27m in Q3 due to rapid strengthening of MYR.

Good thing is bulk of this still remain unrealised loss as yet to convert back to Ringgit.

Ringgit start weaken significantly since early Q4

4 weeks ago

Without the one off items, Q3 result actually much better than Q1 or Q2!

Q4 should look much more better now; especially add back the unrealized gain in forex

4 weeks ago

curiousq

Be careful !! FF goes Holland 😯

4 weeks ago

Favco result Ok la~ 9 months tax paid around 17.6m

Base on 30% tax rate, the actual earning before tax should around 58.9m~ close with reported PBT 35.6m + forex loss of 24.8m

Unrealised loss eh~ Next quarter will add back!

4 weeks ago

FAVCO’s result Comparison between 9m24 vs 9m23:

Revenue: 569.4m vs 459.4m (+24%)
PBT: 35.6m vs 53.9m (-34%)
Core PBT: 56.8m vs 39.1m (+45%)
Tax pay: 17.7m vs 14.0m (+26%)

**core PBT refer to PBT exclude all one off items

Improving or terbalik? Clearly for judge !!!

4 weeks ago

Muhibah core PBT (profit before tax & minority interest + exclude all one off items)

(RM‘000)

24Q3: 22,574
24Q2: 39,382
24Q1: 22,592

23Q4: 74,756
23Q3: 36,748
23Q2: 4,971
23Q1: 11,191

**Q4 used to exceptional stronger

3 weeks ago

24Q3 Result:

Construction: terrible, making loss!

Crane: hurt by forex but core earning actually achieve better Q-Q & Y-Y

Concession: superb; almost double Y-Y or Q-Q !
(Airport + roadcare both improve)

3 weeks ago

Core earning for 9months 2024 vs 2023:
RM ‘000
84,548 vs 52,910

9month 2024
Construction: -6.166m
Crane: 56.780m
Concessions: 61.902m
Elimination: -27.968m

9month 2023
Construction: 21.171m
Crane: 39.141m
Concessions: 33.230m
Elimination: -40.632m

**PBT exclude all one off items & before minority interest

3 weeks ago

Time to accumulate.

3 weeks ago

CGS's TP @ 1.34
Strong associate earnings; awaiting new wins

3Q24 results in line, supported by Cambodia airport concession
● Muhibbah delivered a 3Q24 core net profit of RM11.4m, bringing its 9M24 core net profit
to RM36.9m. This is within expectations at 69% of our and Bloomberg consensus’ full
year net profit forecasts. We expect better earnings delivery for 4Q24F as construction
and cranes earnings pick up.
● For 3Q24, there was an unrealised forex loss of RM29.5m as the RM appreciated
against the US$. This largely impacted its cranes division in 3Q24 which has US$
receivables given its global operations.
● 9M24 revenue increased by 69% to RM1.4bn, driven by higher revenue for construction
and cranes.
● The key positive in 3Q24 was strong associate profit of RM31.6m (+122% yoy and +96%
qoq), largely from its Cambodia airport concession (Phnom Penh and Silhanoukville).
This is commendable, in our view, as the corresponding figure for 3Q23 included the
Siem Reap airport concession that was surrendered back to the Cambodia government
in Oct 23.
● 9M24 passenger arrivals for the Phnom Penh airport and Silhanoukville airport
concession rose 19% yoy to 3.5m. For 3Q24, China passengers made up 23% of total
passenger arrivals (vs. 18% in 3Q23, and 61% in FY19).
● 3Q24 pretax profit for its crane business, stripping out the effects of forex, jumped 113%
qoq, but slipped 4% yoy, to RM30m. Its construction division in 3Q24 posted a loss
before tax of RM33m due to the reversal of profit recognised from higher inflationary
pressures (vs. RM8m pretax profit in 3Q23).

Needs to clinch more wins to ensure better earnings visibility
● Muhibbah’s orderbook (construction and cranes) was RM1.4bn as at Nov 24, which is
down from its Nov 23 peak of RM2.4bn.
● It has yet to win any material contracts this year but has submitted a large tender for an
EPCC role for the Lang Lebah gas field. Given its prior experience with similar projects
in Gansar, Bekok and Bindu in Terengganu, we see it as a frontrunner for this project.
● Muhibbah’s value proposition is not in government infrastructure or the data centre
space but more in marine-based construction and offshore platforms leveraging on its
Petronas fabrication licence, in our view.
● Its crane business under Favelle Favco has also submitted a tender for the supply of
tower cranes for the world's biggest construction project known as Neom in Saudi
Arabia, with a potential award by early next year.

Reiterate Add and TP of RM1.34 based on SOP
● We like Muhibbah for its attractive valuation at FY25F P/E of 9x (vs. sector of 16x) and
for being a proxy in the recovery in tourist arrivals via Cambodian airports, while its
Petronas fabrication licence should enable it to clinch more Petronas jobs, in our view.
● Key downside risks are non-continuity in earnings delivery and higher raw material
costs.
● Re-rating catalysts include better earnings delivery and stronger tourist arrivals in
Cambodia.

2 weeks ago

Muhibbah Engineering counts on bright prospects to see price uptrend
https://www.moomoo.com/community/feed/muhibbah-engineering-counts-on-bright-prospects-to-see-price-uptrend-113659731836934

6 days ago

Too bad~ year to date still yet to get any contract award.. lang lebah has been delay to early 2025. Same as Saudi’s Neom city.

The only excitement is Cambodia airport continue to growth.

Phnom Penh airport should record average >380 arrival flights per week in Q4 (versus Q3: 363 flights)

6 days ago

Total Contribution from associate should exceed 80mil this year.

6 days ago