MRCB active, up 1.54% on upgrade

KUALA LUMPUR (Nov 22): Malaysian Resources Corp Bhd (MRCB) rose 1.54% in active trade at mid-morning today after Hong Leong IB Research upgraded the stock to “Buy” at 97 sen with a higher target price of RM1.18 (from RM1) and said MRCB’s 9M core earnings of RM56 million (+62% y-o-y) were above house expectations but below consensus.

At 10.06am, MRCB rose 1.5 sen to 99 sen with 2.30 million shares traded.

In a note today, it said MRCB’s property sales for 9M were strong at RM1.2 billion, a stark improvement from RM192 million for the entire FY16.

It said construction year-to-date job wins were at RM468 million, bringing orderbook to RM5.3 billion (5.8x cover).

“3Q net gearing stood at 114% but this should reduce to 36% in 4Q following the completion of the rights issue.

“Disposal of EDL, Menara Celcom and Ascott could potentially transform balance sheet to net cash.

“Raise FY17-19 earnings by 21%, 13% and 11% after factoring better construction margin and property sales.

“Upgrade to BUY, SOP based TP raised from RM1.00 to RM1.18. EDL disposal to provide near term catalyst,” it said.—

For more stories, download pullout here for free.

Looking for properties to buy or rent? With >150,000 exclusive listings, including undervalued properties, from vetted Pro Agents, you can now easily find the right property on Malaysia's leading property portal EdgeProp! You can also get free past transacted data and use our proprietary Edge Reference Price tool, to make an informed purchase.
  1. George Kent to explore new growth opportunities in domestic, regional railway space
  2. Ascott to manage Vietnam’s largest serviced residence integrated development
  3. George Kent says it has not received any offer from MRCB to acquire its stake in LRT3 JV