TRC Synergy and partner win RM348mil rail job
MRT contract lifts TRC share price to all-time high
PETALING JAYA: TRC Synergy Bhd and its partner have secured a RM348.3mil contract from Mass Rapid Transit Corp Sdn Bhd (MRT Corp), lifting its share price to an all-time high.
The job was TRC’s second rail-related contract win in less than two weeks.
The companyis partnering Konsortium Kontraktor Melayu Sdn Bhd to undertake the latest project. It involves the construction of a maintenance depot in Serdang and other associated works for the MRT Sungai BulohSerdang-Putrajaya (SSP) Line.
“Barring any unforeseen circumstances, the board is of the opinion that the project will contribute positively to the earnings and earnings per share of TRC Group in future,” it said in a filing with Bursa Malaysia yesterday.
The stock rallied to a high of 85.5 sen in afternoon trade following the announcement, but settled at 84 sen on profit-taking activities.
The stock had more than doubled its price year-to-date, outperforming most of its peers amid a slew of large contract wins.
On Sept 5, TRC was awarded a RM760.55mil contract from Prasarana Malaysia Bhd for jobs related to the Light Rail Transit (LRT3).
Other major construction jobs secured this year includes a RM1.31bil contract in early August for the Pan Borneo Highway project in Sarawak.
The subcontract from Lebuhraya Borneo Utara Sdn Bhd was for the development and upgrading of the stretch of highway between Batang Skrang and the Sungai Awik Bridge.
Aside from this, it also secured jobs worth RM535.3mil in March for the construction of the MRT SSP and MRT Sungai Buloh-Kajang Lines, after winning a RM231.14mil Brunei airport deal for rehabilitation works at Brunei International Airport’s first phase in the same month.
A Bloomberg poll showed that TRC Synergy had one “buy” rating from KAF-Seagroatt & Campbell Securities and one “neutral” call from Public Investment Bank.
For the first quarter ended March 31, 2017, TRC Synergy’s net profit was up 9.7 times at RM12.1mil from RM1.24mil a year ago, against a 31% drop in revenue at RM132.94mil.
The company was reported in May to be eyeing tenders for MRT and LRT projects this year to boost its property segment contribution.
It aimed to increase the contribution ratio for construction and property segments to 80:20 from the present 90:10.
The stock has risen more than 110% and trading at a historical price earnings ratio of 9.98 times.
It also offers a dividend yield of 2.28% at its market value of RM401.2mil.
Rail jobs: Passengers on the MRT Sungai Buloh-Kajang (SBK) line. TRC secured jobs worth RM535.3mil in March for the construction of the MRT SSP Line and MRT SBK Line. — Bernama