Written by theedgemalaysia.com
Monday, 07 March 2011 08:51
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KUALA LUMPUR: RHB Research said on Monday, March 7 it is maintaining a fair value of RM1.37 and Outperform call on Fajarbaru Builder Group Bhd after it was appointed by Syarikat Prasarana Negara Bhd as the nominated sub-contractor for the light rail transit (LRT) extension projects.
Fajarbaru has been appointed to carry out the CONSTRUCTION [] of Stations 1 & 2 of Ampang LRT line extension project (Package A) valued at RM62.7m and Stations 1, 2 & 3 of Kelana Jaya LRT line extension project (Package A) valued at RM87.4m.
“These contracts have boosted Fajarbaru's YTD new contracts secured to RM249m and outstanding construction orderbook by 30% from RM496m to RM646m. Assuming an EBIT margin of 8%, the two contracts will fetch RM12m EBIT over the construction periods of 21 months.
“Forecasts maintained as we have assumed Fajarbaru secures RM250m worth of new jobs p.a. in FY11-12. Maintain fair value of RM1.37 and Outperform call,” RHB Research said.