RHB sets ‘buy’ call for UEM Edgenta

KUALA LUMPUR: RHB Research Institute Sdn Bhd has initiated coverage on UEM Edgenta Bhd with a “buy” call on expectations of robust growth based on a steady inflow of new jobs from the growing integrated facilities management (IFM) market.

UEM Edgenta is Malaysia’s largest IFM provider with expertise covering consultancy, services and solutions for the healthcare, infrastructure and real estate segments.

RHB Research said UEM Edgenta was expected to continue benefiting from the nation’s growing IFM market, which recorded a 7.9 per cent compound annual growth rate over the last five years.

The research firm said UEM Edgenta’s infrastructure wing was set to embark on a performance-based contracting (PBC) framework for the network management and maintenance of the North-South Expressway.

“The PBC framework is also expected to improve its infrastructure solutions wing’s margins,” said RHB Research.

It said the stock would offer decent dividend yields of four to five per cent for financial year 2018/2019.

“We like UEM Edgenta and set a target price of RM3.22 for the stock,” it added.

At lunch break, UEM Edgenta added one sen to RM2.71 with 250,100 shares traded.

RHB Research says UEM Edgenta is set to gain from the integrated facilities management market.