Bursa Stock Talk

Is Bina Puri cheap?

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Publish date: Sun, 02 Oct 2016, 03:27 PM
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Bina Puri was founded in 1975. It celebrated its 40th anniversary in 2015. Among its track records:

- Completed many types of civil and building projects in various parts of Malaysia, including East Malaysia 
- It has completed several projects in overseas (Thailand, Brunei, Russia, India, Nepal, Pakistan, UAE, China, and etc.)
- Completed Ampang LRT line extension
- Completed KLIA2 satelite building
- A group with turnover exceeding a billion RM (since 2010)
- Uninterrupted yearly profit since 2000

In terms of assets, the group has:

- Recurring income from power generation business in Indonesia (more than 30MW)
- 50% stake in LATAR Highway
- Net asset value per share of 93.47sen as of end June 2016
- Recurring income from Main Place shopping mall (33% effective stake)

For its construction division, it has a strong outstanding order book of RM2.0b. It is actively tendering for civil works such as LRT 3, MRT 2, and various highway projects.

However, some readers may not be aware that the group's market capitalisation is only RM101m (share price 41.5sen) last Friday.

Construction companies such as Gamuda, IJM were founded around 1970's or 1980's. Their market capitalisations have now exceeded RM10b. Late comer Gadang which Tan Sri Kok Onn took over the control in 90's, is having a market cap of RM742m. It has similar business segments as Bina Puri (construction, property and utilities). Construction specialists focusing in foundation works, Econpile, Ptaras have market caps of  RM904mn, and RM582m.

Before reading further, what do you think?
a) The stock is grossly undervalued
b) There could be reasons for the uninspiring share price performance.

In 2013, Ng Keong Wee took up private placements by the group at RM1/share and emerged as a substantial shareholder with about 9% to 10% holding in the group. About 3 years down the road, his stake has been diluted to 5.8%. A bigger concern is the paper loss as the share price has declined to about 40sen/share now.

Some bloggers have recommended this stock but why is the share price fails to excite in a sustainable manner? 

Even though the numbers look good, unless there is a positive change in certain "qualitative" aspect of the group, I am skeptical that the share price will go far in a sustainable manner.

Separately, SJC is an advertising company. It is in net cash position with the value close to its market cap. This is before including some good properties owned by the group. The group has been profitable in recent years. It also pays dividend. Last week, it has just secured a 10-years concession from MRT which may double the group's revenue. Despite all these, there was no appreciation in terms of share price. This stock is under researched but I am sure there are investors who know the group and its financial standing. Other than share trading liquidity, what is lacking is the stock?

I see similar issue in Menang and AYS. Again, unless there is a positive change in certain "qualitative" aspect of the group, I tend to think the share prices of these listed companies won't go far.
BPURI (5932)
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Discussions
1 person likes this. Showing 10 of 10 comments

bearbear11

Another Calvintanen?

2016-10-02 15:38

VenFx

Always got to ask WHY WHY WHY their net profit extremely low ?

2016-10-02 16:19

muscular

Tis bodoh bina puri u beter never touch... A lot of projects, but cannot made good profit.. Just like for turnover but no profit.. Just kerja kerja kerja saje

2016-10-02 16:43

Wing50

Good indepth comparison to reveal reasons for depressed share price. Much better than FA and TA.

2016-10-02 17:04

speakup

founded in 1974 lar (not 1975)

2016-10-02 18:02

moneySIFU

Wow, no name author

2016-10-02 21:29

probability

Calvin must be cursing... his original pro-article did not appear on Top articles instead this one came up!

2016-10-03 17:07

calvintaneng

Posted by probability > Oct 3, 2016 05:07 PM | Report Abuse

Calvin must be cursing... his original pro-article did not appear on Top articles instead this one came up!

Calvin answers:

Never expect to be popular at all

Since 90% of the market consists of gamblers and short term punters Calvin's stock pick is only for the fortunate 10% deep value investors.

Calvin is happy to SEE all views: For or Against BPuri also welcome.

Great Champion Sifu MG9231 always join with Johor Buddies to do brain storming.

Like last time all these 3 shares started with P traded around 70 to 80 cts only

Prinsiptek at 70 to 80 cts in year 2005/6
Protasco also 70 to 80 cts in year 2005/6
PTaras Jaya same: 70 to 80 cts in year 2005/6

Which one of the 3 "P" is the best?

MG9231 picked PTARAS JAYA For these reasons

1) ESOS & TOP BOSS Bought PTaras Jaya from open market.
2) PTaras is into piling work. And will get paid first or else can sue & the work will stop. So there is margin of safety.
3) PTaras Jaya's profit is exceptional compared to others.

As it turned out The Brain Storming Session Caused Us to Pick PTaras Jaya. And PTaras Jaya Shot up near 10 baggars gain.

Prinsiptek was a really lousy stock.
Protasco is somewhere in the middle.

So the more YOU DIG DEEPER INTO BPURI THE MORE YOU WILL FIND ITS COMING GOOD PROSPECTS.

INSIDERS ALREADY "SEE" FAR AHEAD AND LOADED UP!!

2016-10-03 17:22

paperplane2016

Calvin, M2931 or 9321? hehe he is your Johor sifu? lots to learn from him!

Now I aim EKOVEST, RCECAP. hope for best

2016-10-04 12:32

calvintaneng

Paperplane,

He is MG9231. At one time best friend of TTB. TTB offered him Icap shares at par value of Rm1.00

Now he is fed up of TTB doing nothing.

Anyway, I think your GKent did well because It is related to Najib. And BPuri will also do well like GKent as election is coming. UMNO and MCA both need money.

So Bpuri bound to receive more project award like GKent

2016-10-04 15:08

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