#IPO watch* BIMB Securities rates Econpile a Buy, target price 73 sen

KUALA LUMPUR (June 27): BIMB Securities Research has a Buy rating on Econpile Holdings Bhd at 54 sen with a target price of 73 sen.

Econpile Holdings, a piling specialist providing a full range of piling solutions and foundation works nationwide is set to be listed on the Main Market of Bursa Malaysia on Monday, June 30.

For its initial public offering, the company had issued 90.0 million new shares at the offer price of 54 sen per share.  

BIMB Securities said that based on its projection, Econpile’s net earnings were expected to improve by 11.2% and 14.2% for FY14/15 respectively.

“The Group’s outstanding orderbook in hand stands at RM450 million comprising of 5 projects lasting over the next 2 years. Of the total, close to 90% are property centric projects while the remaining infrastructure based.

“We are projecting around RM300 million in orderbook replenishment for FY15 on the back of the tender book of about RM2 billion,” it said.

BIMB Securties has a Buy rating for Econpile with a target price of 73 sen with a prospective upside exceeding 30%.
“Our target price is premised on a PER at 11x derived from its peers with the industry small-caps PER in a range of between 9x – 11x,” it said.