ZECON - Trading Halt and Resumption of Trading 27 Nov 2017, 14:28 ZECON - Trading Halt and Resumption of Trading ZECON - Trading Halt and Resumption of Trading ILC-27112017-00001 Kindly be advised that trading in ZECON's shares will be halted with effect from 2.30 p.m., Monday, 27 November 2017. Trading in the shares will resume with effect from 3.30 p.m., Monday, 27 November 2017. Your attention is drawn to the Company's announcement dated 27 November 2017. VP, ISSUERS You are advised to read the entire contents of the announcement or attachment. To read the entire contents of the announcement or attachment, please access the Bursa website at http://www.bursamalaysia.com
https://klse.i3investor.com/blogs/stockalliance/162425.jsp Here is what we think of our stocks ZECON & CNOUHUA. Possible a volatile day for these two stocks during monday. Cheers and goodluck everyone. Stay with us and hopefully next week is a good day
Will this effect their hospital concession in Cheras as well (which is being held by the same entity, Zecon Medicare)?
And what will happen to the 49% sales of Zecon Medicare to Sarawak state for RM155mil? In the news it seems that even the sarawak state was agreeable for the termination of Zecon Medicare as Petra Jaya Hospital contractor. Don't understand why you would want to do that if you plan to buy the company, right?
This month is supposed to be the deadline for the delivery of the Hospital Pakar Kanak Kanak in Cheras. Can they meet the target? Or is there going to be a risk of cancellation as to what happened with their Petra Jaya hospital contract. The only difference here is that the progress for Cheras is a lot better compared to Petra Jaya. As of July, it was 74% completed.
The recent statement of material uncertainty (current liabilities exceed current asset) is also a big worry. Has it effected the operation of the company in particular the completion of the Cheras hospital.
What happen with the RM155mil deal between Zecon and the Sarawak state? The last announcement was back in March. Is it still on? Just wondering since Sarawak state was also agreeable to cancel the company Petra Jaya contract back in July. Why invest in a contractor that you just rejected?
For some reason, if you are interested in investing into this company, it is advisable you wait till they complete the Hospital in Cheras. Once that is done there will be less risk facing the company.
Highest risk will always be during construction period for this type of company especially if there are delays (which the company is actually facing for the Cheras hospital. supposed to be completed in Nov). The biggest risk would be the cancellation of the concession contract (this is actually where the big values lies for Zecon hence why Sarawak govt was interested in acquiring Zecon Medicare). They already had their Petra Jaya Hospital contract cancel earlier this year. Not sure if they need to pay LAD...
Anyway if you are looking to diversified a bit of your portfolio outside of the construction industry, i would recommend you to buy MBMR.
The company is a direct proxy to Perodua via its 22.6% interest in the company. Valuation is cheap at only 5.3x PE (based on target FY18 PATAMI of RM145mil. 9m PATAMI is already RM106mil). PB is low at only 0.5x BV. 4Q18 results is expected to be higher than 3Q18 and last year 4Q17. And FY19 growth will be driven by the still high demand of new Myvi and the launch of the new SUV in 1Q19.
The handover of the Hospital Pakar Kanak Kanak (HPKK) is delayed to July 2019 instead of Nov 2018. I think they will need to pay some LAD (penalty) which should be reflected in the 2Q and 3Q of FY19. That is still ok as long as they still hold the concession. What would be more worrying is if they failed to complete the hospital by the new deadline of which I think the government might be forced to cancel the contract just like what had happen to their Petra Jaya contract which was terminated in July 2018 due to continuous delays.
Given the company's very weak balance sheet (current asset of RM210m vs current liabilities of more than RM800mil), I have my doubts on their ability to complete the HPKK project before the new deadline.
If you are looking to diversify your portfolio outside of Zecon (due to its earnings uncertainties and going concerns issues) I would recommend you to look at MBMR.
MBMR is a direct proxy to Perodua via its 22.6% interest in the company. Valuation is cheap at only 6.9x PE (based on target FY18 profit of RM145mil. 9m profit is already RM106mil). PB is low at only 0.7x BV. 4Q18 results is expected to be higher than 3Q18 and last year's 4Q17.
For FY19 growth will be driven by the still high demand of new Myvi and the newly launched SUV Aruz and also the newly revamp Alza in 2H19. I am projecting a profit to shareholder of RM160 mil for FY19 which at the current price values MBMR at only 6.2x PE.
Please go through the analyst reports (https://klse.i3investor.com/servlets/stk/pt/5983.jsp) and do your own analysis before making any decisions. There are 8 analysts in total covering the stock with most of them having a TP of above RM3 (all have a buy rating). The average TP for the 8 analyst is around RM3.50.
PPAM contract terminations to impact more developers: Report
KUALA LUMPUR (March 9): More Malaysia Civil Servants Housing Programme (PPAM) projects are “expected to be either put on hold or shelved”, reported The Edge Malaysia in its latest issue.
A source told the weekly that Protasco Bhd has been informed by Putrajaya Corp (PjC) (the project owner of PPAM in Putrajaya) to “temporarily postpone” development.
It was reported on Feb 27 that Damansara Realty Bhd announced that PjC had terminated a contract to develop 1,350 residential units and 45 commercial units with a gross development cost of RM467.3 million in Precinct 5 of Putrajaya.
Damansara Realty announced that the termination “was due to the government’s move to unify the development of affordable homes under the Ministry of Housing and Local Government”.
Developers contracted to construct PPAM homes include Ahmad Zaki Resources Bhd, Hap Seng Consolidated Bhd, Iris Corp Bhd, Zecon Bhd, LBS Bina Bhd and Spring Gallery Bhd.
“The level of progress of these projects could not be ascertained,” wrote the business publication.
This book is the result of the author's many years of experience and observation throughout his 26 years in the stockbroking industry. It was written for general public to learn to invest based on facts and not on fantasies or hearsay....
Mohd Fahmi Bin Jaes
29,107 posts
Posted by Mohd Fahmi Bin Jaes > 2017-11-27 14:55 | Report Abuse
ZECON - Trading Halt and Resumption of Trading
27 Nov 2017, 14:28
ZECON - Trading Halt and Resumption of Trading
ZECON - Trading Halt and Resumption of Trading
ILC-27112017-00001
Kindly be advised that trading in ZECON's shares will be halted with effect
from 2.30 p.m., Monday, 27 November 2017. Trading in the shares will resume
with effect from 3.30 p.m., Monday, 27 November 2017. Your attention is drawn
to the Company's announcement dated 27 November 2017.
VP, ISSUERS
You are advised to read the entire contents of the announcement or attachment.
To read the entire contents of the announcement or attachment, please access
the Bursa website at http://www.bursamalaysia.com