TRC Syn­ergy and part­ner win RM348mil rail job

MRT con­tract lifts TRC share price to all-time high

The Star Malaysia - StarBiz - - News -

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

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