GAMUDA (5398) : Affin Hwang maintains Add on Gamuda
KUALA LUMPUR: Affin Hwang Research has maintained its Add call on Gamuda with a target price of RM5.30 based on 16 times CY15E EPS.
In a note on Wednesday, the research house said Gamuda's 1QFY15 core net profit is within expectations and is on track for another record year.
Delay in start of Line 2 and likely slower property sales in 2015 may cap profit growth in FY16E but PDP contract for Line 2 is in hand while it is well-positioned for the underground package.
It is also eyeing the PDP role for the Penang Transport Masterplan project. Land banking will further boost massive GDV and SPLASH sale may be soon, it said.
It added that Gamuda's property sales slowed further to RM240mil in 1QFY15 from RM300mil in 4QFY14 and FY15 sales target of RM1.84bil is being revised downwards.
However, unbilled sales of RM1.5bil is expected to sustain property profit for the next 4-5 quarters. Aggressive acquisition has boosted land bank by 2,647 acres and a few more land deals are likely to close in FY15, it said.
The research house added that talks on Splash sale with the Federal and Selangor state governments are in progress.
"The asset is now classifed as “Asset held for sale” and a satisfactory resolution is likely in the next few months. Net book value of Splash has increased to around RM2.8bil from RM2.5bil," it noted.
http://www.thestar.com.my
KUALA LUMPUR: Affin Hwang Research has maintained its Add call on Gamuda with a target price of RM5.30 based on 16 times CY15E EPS.
In a note on Wednesday, the research house said Gamuda's 1QFY15 core net profit is within expectations and is on track for another record year.
Delay in start of Line 2 and likely slower property sales in 2015 may cap profit growth in FY16E but PDP contract for Line 2 is in hand while it is well-positioned for the underground package.
It is also eyeing the PDP role for the Penang Transport Masterplan project. Land banking will further boost massive GDV and SPLASH sale may be soon, it said.
It added that Gamuda's property sales slowed further to RM240mil in 1QFY15 from RM300mil in 4QFY14 and FY15 sales target of RM1.84bil is being revised downwards.
However, unbilled sales of RM1.5bil is expected to sustain property profit for the next 4-5 quarters. Aggressive acquisition has boosted land bank by 2,647 acres and a few more land deals are likely to close in FY15, it said.
The research house added that talks on Splash sale with the Federal and Selangor state governments are in progress.
"The asset is now classifed as “Asset held for sale” and a satisfactory resolution is likely in the next few months. Net book value of Splash has increased to around RM2.8bil from RM2.5bil," it noted.
http://www.thestar.com.my
