News by Affin Hwang Capital

A diversified asset base should lower earnings risks, while a larger market capitalisation should increase the REIT’s liquidity (if acquisitions are partly funded by equity). A diversified asset base should lower earnings risks, while a larger market capitalisation should increase the REIT’s liquidity (if acquisitions are partly funded by equity).

With sustained strong overseas property sales and an expansion in local sales (more launches for Gamuda Cove, Gamuda Gardens and twentyfive.7 townships), Gamuda is targeting sales of RM4 billion for FY20.

Incorporated in 2002 and strategically located in Kuala Lumpur’s Golden Triangle, Prince Court owns and operates a 277-licensed bed private healthcare facility offering a wide range of medical, surgical and hospital services such as burn management, cancer, gastrointestinal diseases, interventional cardiology, in vitro fertilisation, nephrology, occupational health, orthopaedic and rehabilitation medicine.

The Klang Valley Light Rail Transit Line 3 (LRT3) project contributed a profit after tax of RM1 million for 6MFY19 compared with RM15 million for 6MFY18 to JV income due to work delays caused by the remodelling of the project to reduce costs.

SunCon clinched RM1.54 billion worth of new contracts year to date, including the RM310 million Petronas Leadership Centre project secured recently.

The stronger-than-expected performance was mainly driven by higher revenue recognition of its Vietnam engineering, procurement and construction (EPC) project, as work progress started to catch up.

Affin Hwang Capital: We view the concession termination agreement positively as it will reduce the group’s net gearing of 0.53 times at end-2017 to 0.28 times.

Affin Hwang Capital Research: Although the government cancelled, delayed and renegotiated multiple big infrastructure projects, the RM8.9 billlion Gemas-JB Electrified Double Tracking (EDT), of which YTL is one of the two main sub-contractors, remains intact.

The new government’s shift to prioritise inclusiveness in development will see higher allocation of development expenditure to less developed states and expanding public services and utilities.

The outlook for the construction sector remains challenging as the federal government is reviewing ongoing infrastructure projects to reduce costs by 20%-33%.