HSL expected to win jobs worth more than RM600 million
Posted on August 1, 2012, Wednesday
KUALA LUMPUR: Sarawak-based infrastructure developer Hock Seng Lee Bhd (HSL) is most likely to win new jobs worth more than RM600 million this year, says Maybank Investment Bank Bhd (Maybank IB). It said HSL’s active tendering continued with sizeable jobs worth up to RM1 billion to be awarded in the next six to nine months. The company’s job wins of RM472 million, year-to-date, have surpassed 2011’s RM313 million, lifting outstanding order book to RM1.3 billion.
“This will underpin record earnings in financial year 2012, sustainable into financial year 2013,” Maybank IB said in a research note.
It also said HSL’s sizeable jobs secured, year-to-date, included the Balingian-Sibu-Bintulu Road (RM82 million) and Universiti Teknologi Mara, Mukah campus (RM291 million), which have lifted its order book to RM2 billion in contract value and RM1.3 billion in outstanding works.
“As the new jobs include sizeable marine engineering works components, we expect margins to be high, at least 15 per cent at the gross level. We tweak our margin assumptions for some of newer jobs, resulting in a seven per cent upgrade in our financial year 2012 to 2013 net profit forecasts,” the research house said.
Meanwhile, Maybank IB also upgraded to a ‘buy’ call on HSL’s shares, with a raised target price of RM2.25 from RM2.10, previously. — Bernama