Tuesday, 19 March 2013

WCT - Nicks Putrajaya building jobs BUY


-  Maintain BUY on WCT with an unchanged fair value of RM2.85/share – pegged at a 15% discount to its sum-ofparts value.

-  WCT announced on Bursa Malaysia yesterday that the group has secured a building contract worth a combined RM313mil from Putrajaya Holdings Sdn Bhd.

-  Prior to this, WCT has undertaken other building jobs within Putrajaya – whereby these repeat orders further cement the group’s growing reputation.

-  The latest job is for the construction and completion of commercial office buildings, as well as external work on Lot 2C5, Precinct 2, Putrajaya:-
     - 2 Blocks of commercial offices comprising a 7-storey podium and overall 14-storey tower ; and
     - 2-level basement carpark

-  The scope of works comprises the foundation, structural and architectural, mechanical, electrical & plumbing services, external and services, and landscape.

-  The tenure of the contract is for 32 months from the date of site possession.

-  We are leaving our FY13F numbers unchanged as this new contract forms part of our new order book assumption of RM1.7bil for the current financial year.

-  Nonetheless, this new win provides a good start for WCT –as job visibility is likely to accelerate post the 13th General Election.

-  We gather that WCT has between RM4bil and RM5bil worth of ongoing bids at the moment.

-  Key bids for 2013 include:- (i) two hospitals in Sabah (~RM900mil); (ii) Media City (RM400mil); (iii) Phase 2 of RAPID earthworks package (RM500mil); and (iv) Tun Razak Exchange earthworks (RM1bil); and (v) Gleneagles Medini Iskandar (~RM300mil).

-  We like WCT’s deepening penetration into the Iskandar Malaysia region, where it has been a prime mover in both the property and infrastructure space.

-  Further impetus would come from the opening of Gateway@KLIA2 (NLA: 350k sq ft; 6,000 car parks) from 2Q13 onwards.

Source: AmeSecurities

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