KUALA LUMPUR: Hong Leong Investment Research has kept a Buy call on Mitrajaya with a target price of RM2.92, pegged on FY15-16 P/E of 14.7 times and 12.2 times respectively.
In a note on Tuesday, the research house said Mitrajaya offers investors superior earnings growth prospects with 3 year CAGR of 24% on the back of undemanding valuations at 9.1 times and 7.6 times FY15-16 P/E.
Given strong job wins recorded last year at RM1.1bil, Mitrajaya currently sits on an all-time high orderbook of RM1.9bil.
This implies a superior orderbook cover of 5.1 times FY14 construction revenue vis-à-vis its peers average of 2.1 times. As such, earnings growthvisibility over the next 2 years is already anchored by this.
The research house said the company's year-to-date job wins amount to RM230mil and management is gunning for RM1bil this year compared to the more conservative assumption of RM500mil.
"Mitrajaya has tendered for RM1.9bil worth of jobs comprising buildings in the Klang Valley (RM1.4bil) as well as buildings (RM350mil) and infra works (RM180mil) in Johor.
"We gather that a potential contract win (RM300mil) could be on the cards over the next 1 to 2 months.
"Aside that, Mitrajaya is also a strong contender for the LRT3 station works which should take off in 1Q16," it said.
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