With more visibility from the completion of the sections of the expressway and expectations of profitability, WCE’s shares have attracted investor interest. Since the start of the year, its share price has risen more than 67% to 53.5 sen apiece last Friday, translating into a market capitalisation of RM1.6 billion.
However, it might be too early to talk about profit. Indeed, there is concern whether WCE needs to raise more funds to complete the project, thanks to the cost overruns.
Under the concession agreement between WCE and the federal government, the first RM980 million for land acquisition would be borne by the government. The remaining amount is to be absorbed by WCE. “But land acquisition costs have ballooned to RM2.2 billion,” Lyndon says.
That has raised the total cost of the expressway to more than RM8 billion, including land acquisition costs of RM2.2 billion and construction costs of RM5.94 billion, which also consists of interest expenses of RM900 million. The initial budget for the project was RM5.9 billion, excluding land acquisition costs of RM980 million.
yes shd be profitable. but analysts will look beyond this once-off transaction and see the numbers in greater detail. and good to see management guidance on near prospects especially, since some info already shared in Edge paper
The stock rose and broke out of its 2-week long triangle sideways trend with a white candle late last week. Last Friday’s breakout was backed by a higher trading volume. The rising EMAs and coupled with the higher highs and higher lows formation may give the current uptrend a boost.
Get real, whole market has been downtrend for a couple of weeks now, WCE is already holding up too well Those with good QR can only gain a tiny bit, only to drop back the next few days
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Edge
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Posted by Edge > 2023-05-17 21:24 | Report Abuse
Good opportunity to buy during price pullback and market weakness