KUALA LUMPUR: PublicInvest Research is keeping Sarawak-based Hock Seng Lee at Neutral with an unchanged target price of RM1.80, which is pegged at an unchanged 12 times FY17 earnings per share.It said on Monday HSL clinched another major sewerage-related from the Sewerage Services Department Sarawak for phase one of a wastewater treatment plant and sewer networks project in Miri for RM333.07mil.“Assuming profit before tax margin of 15%, the new job is expected to contribute a total of RM38mil in net profit over the construction period of 48 months.“Earnings are kept unchanged as the new job win in within our job replenishment assumption of RM600mil per annum,” it said.The research house said the new job entails earthworks, construction and commissioning of the wastewater treatment plant, sewer networks, intermediate pump station including associated works and property connections.With the new job secured, the HSL’s outstanding orderbook is estimated to be at RM2.5bil.To recap, it secured two mega projects (that is the RM1.7bil Pan Borneo Highway package and the RM750mil Kuching Centralised Wastewater Management Package 2) in FY16, which leapfrogged its outstanding order book at a historic high.

Source: The Star March 06, 2017 01:18 UTC