Sunway has accepted
the letter of award for the KLCC North East Car Park worth RM304m. With this
contract, Sunway has successfully replenished its construction orderbook to
RM1.25bn YTD. We believe Sunway can easily meet our orderbook assumption of
RM1.5bn for the year. Current outstanding orderbook amounted to RM4.2bn.
Coupled with RM2.78bn unbilled sales, earnings visibility will be strong.
KLCC underground
carpark construction contract. The contract covers the construction and
completion of 6 levels basement North East Car Park (NEC) underneath KLCC Park
and the associated works. The job is expected to kick start from the date of
site possession (to be determined) for 178 weeks (or 3.5 years). The contract
is expected to contribute to the company’s earnings from FY13 onwards.
Orderbook raised to
RM1.25bn. In less than three months, Sunway has successfully replenished
its construction orderbook by RM1.25bn. Current outstanding orderbook is
boosted to RM4.2bn. In addition to the RM2.78bn worth of unbilled property
sales, earnings visibility for the company is strong.
Forecasts.
Unchanged, as the contract secured YTD is within our orderbook assumption of
RM1.5bn for FY13.
Investment case.
We keep our Buy rating unchanged, and likewise our fair value of RM3.25, based
on 30% discount to RNAV. The continued delivery of construction jobs, prudent
landbanking efforts, responsive product launches as well as the strategic
landbank exposure in Iskandar reaffirm our confidence in the stock.
Source: RHB
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