- We maintain our HOLD recommendation on Puncak Niaga Holdings,
with an unchanged fair value of RM1.54/share. This pegs the stock to a 7% discount on its
estimated sumof-parts (SOP) value.
- Puncak’s 2QFY12 net profit came in at RM78mil – bringing 1HFY12
earnings to RM147mil. As expected, Puncak did not declare any interim dividend
for the quarter under review.
- The results constituted 56% of both consensus as well as our
estimates. We envisage 4Q contributions from the oil & gas division to
taper off towards the year-end.
- 2QFY12 earnings rose 15% QoQ largely on a pick-up in activities
for both the construction and oil & gas operations.
- Similarly, 1HFY12 swung to the black from a RM4mil loss a year
earlier on improvements in all of its operating units. Group operating margin
remained fairly stable at ~26%.
- Turnover for SYABAS grew 32% YoY to RM1.3bil – reflecting
the recognition of a scheduled tariff hike effective 1 January 2012 as per its
concession agreement.
- At half-time, the oil & gas division reported an EBIT
of RM41mil (~7% of group EBIT) compared with an operating loss of RM6mil a year
earlier. This was further lifted by the full-year consolidation of a 100% stake
in Global Offshore (Malaysia).
- We have assumed Puncak to sustain an oil & gas order book
of RM700mil p.a. over FY12F-14. This is anchored by more Offshore Installation
Contracts (OIC) from Petronas.
- In addition, Puncak continues to eye marginal oilfield opportunities
in Malaysia although the timing is uncertain. Our preliminary estimates
indicate that any such win may lift its break-up value by RM0.33/share (6.4%)
based on an effective stake of 30%.
- But, we believe it is still dead money risk for Puncak despite
the stock trading at a steep 75% discount to its SOP value.
- As such, our HOLD rating on Puncak remains until there is more
clarity on the water impasse in Selangor post the 13th General
Election.
Source: AmeSecurities
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