TRC (5054) - TRC Synergy Berhad - Bags RM858.2m MRT2 Job
Various news reports
indicated that Mass Rapid Transit Corp Sdn Bhd (MRT Corp) has awarded
work packages worth a total of RM2.74bn to four companies for the MRT2
Sungai Buloh-Serdang-Putrajaya (SSP) Line. Trans Resources Corporation
Sdn Bhd, a wholly-owned subsidiary of TRC Synergy is said to have
successfully clinched a contract worth RM858.2m, which is the second
largest contract in this final viaduct tender award by MRT Corp. This
comes as a positive surprise to us, more on the quantum of the award,
even though we have earlier indicated that TRC Synergy could be a
beneficiary of planned rail projects in Malaysia. This contract win, we
believe, should assuage earlier concerns of the Group’s ability to
secure MRT-related projects due to the cancellation of a small project
by MRT Corp late last year. All told, we are adjusting our replenishment
rate from RM500m to RM1bn, and revise our FY17-19 earnings upwards by
4%/7%/28% respectively. As such, our TP is now RM0.59 (from RM0.50), with valuations rolled over to FY18, based on an unchanged PER multiple of c.10x. Maintain Trading Buy.
TRC (5054) - TRC Synergy Berhad - Bags RM858.2m MRT2 Job
- Scope of works. TRC is said to have secured the V205 package which is for the construction and completion of the viaduct guideway and other associated works from Kampung Muhibbah to Serdang Raya. This will be the Group’ first “V” or viaduct package as it was only involved in depot and ancillary works in MRT 1 previously.
- Outstanding order book. With the new contact win, the Group’s outstanding order book is now estimated to be at RM1.8bn, ensuring earnings visibility for the next 2-3 years. Going forward, we believe the Group is still eyeing projects which among
Source: PublicInvest Research - 13 Mar 2017
TRC (5054) - TRC Synergy Berhad - Bags RM858.2m MRT2 Job
http://klse.i3investor.com/blogs/PublicInvest/118121.jsp
