The Board of Directors of Ahmad Zaki Resources Berhad (“AZRB” or “the Company”) is pleased to announce that its wholly-owned subsidiary, Ahmad Zaki Sdn Bhd had on 1 April 2016 received a Letter of Acceptance (“LoA”) from Mass Rapid Transit Corporation Sdn Bhd (“MRT Corp”) (“the Award”) for a project known as “Package V202: Construction and Completion of Viaduct Guideway and Other Associated Works from Persiaran Dagang to Jinjang” (“the Works”).
Information on the Works
The Award for the Works amounts to a total value of RM1,439,529,169.38.
Financial effects
The Works is expected to contribute positively to the Group’s future earnings.
AZRB fits squarely into the category of a smaller-cap pure contractor with decent order book growth and new recurring income assets, and that is hugely undervalued relative to its RNAV. Longer-term recovery prospects are underappreciated, in our view. AZRB is worth double its market value.
Based on our estimates, the stock is worth double its value today. The share price is a big laggard when compared to the share prices of other small-cap contractors or other small-cap stocks in general, which have surged or even doubled YTD. For AZRB, we apply a 50% discount to AZRB's RNAV/share of RM2.95. The 50% discount is fair in our view and it is higher than the 10-40% we apply to the construction stocks under our coverage. We arrive at an implied value of RM1.48/share, which implies an upside of 103%.
AZRB share should more than RM1.00 if following division show more positive result: 1) Oil and Gas Division: Claimed no impact of global oil price and expects increasing contribution from its operations at Tok Bali Supply Base. 2)Plantation Division: expects to generate higher revenue and start to contribute to the group as yields of Fresh Fruit Bunches (FFB) to continually improve, plam oil price up and stringent cost controls of this division.
Salam, Base on lasr q result, the plantation was the major loss that drag down AZRB and in fact O&G was at profit of 14mil. The plantation of 4700+ha is still at initial harvest stage.
check their financial yoy quarter increasing from the same quarter from the previous year also increasing.. with all the contract winning.. this improvement will be more significant in the next quarter
anyone care to update on the pending receipt of RM79.6m from successful claim for damages due to the wrongful termination of Al-Faizal University project?
Why the trade n other receivables in balance sheet was Rm1.2 billion, but quarterly sales only about 230 million? Will it be substantial bad debt? Or it was due to other reasons?
if you go through all the announcement, you will see substantial contract awarded, same with mitra with PE lower than 10. In the next quarter you will start to see material effect on the balance sheet with all of these awarded contract. thats when you know you are investing in the future.
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....
cryhappy
3 posts
Posted by cryhappy > 2016-03-31 17:14 | Report Abuse
wait for tomorrow...hope can fly rocket