News Column

Maybank KE maintains `buy' call on Gamuda

January 27, 2014

MAYBANK KE Research has maintained its "buy" call on Gamuda with a target price of RM5.30 for its earnings growth prospects and undemanding valuations. In a note on Monday, Maybank KE said Gamuda remains confident of clinching the project delivery partner (PDP) role for the Klang Valley Mass Rapid Transit 2 (KVMRT2) despite whispers on the contrary. "However, the Gemas-Johor Baru double track rail construction award has been further delayed to 2015 from late-2014. "Meanwhile, property sales has remained robust, especially in Horizon Hills . As for its water assets sale, potential invocation of S114 WSIA has raised concern on the offer value." It added that the risk of the invocation of S114 could induce short-term negative sentiment on the stock, although the impact on the water asset sales is not certain yet. The government's final go-ahead for the KVMRT 2 and appointment of its PDP is expected to be announced in first quarter of this year. "Gamuda-MMC is confident of clinching the PDP role, riding on their track record in managing the KVMRT 1 construction."

For more stories on investments and markets, please see HispanicBusiness' Finance Channel

Source: Business Times (Malaysia)

Story Tools