Econpile bags RM208 mln Jalan Ampang contract
KUCHING: Econpile Holdings Bhd ( Econpile) has secured a RM208 million contract to undertake piling works for a mixed commercial development on Jalan Ampang.
AmInvestment Bank Bhd’s research arm ( AmInvestment Research) highlighted that the contract was awarded by Oxley Rising Sdn Bhd.
The contract entails bored piling and pilecaps, diaphragm walls, earthworks, foundation and substructure works with duration of the contract set for 26 months.
Based on reports, Oxley Rising (part of Singapore-listed Oxley Holdings) is building a three-tower development ranging from 28 to 79 storeys on three acres of land in Jalan Ampang. The site is adjacent to the Petronas Twin Towers.
Dubai-based Jumeirah Group will operate a 190-room luxury hotel and 273 premium residences within the development, which is expected to be completed in 2021.
“We are pleasantly surprised with the latest win – which brings Econpile’s new job wins in FY16F to RM655 million. This has surpassed our replenishment target of RM500 million by 31 per cent.
“Nevertheless, as we had previously guided, we believe any jobs secured this month will only contribute strongly to the group’s earnings from FY17F. Hence, we make no changes to our numbers. For FY17F, we have a new order book target of RM450 million with potential upside,” noted the research house.
The latest win is timely as 20 per cent of the group’s capacity will be freed up following the completion of a few projects next month.
Given the scope and nature of the latest job, AmInvestment Research believe margins should be attractive. Outstanding order book of RM778 million will support earnings until 2018.
“We believe more jobs will flow through in the coming months with potential wins from KVMRT2, highways.
“All in, we continue to like Econpile for its strong track record as a leading piling specialist, continued contracts wins on resilient demand, and stable margins. Since its listing, net margin has expanded from 6.5 per cent to 15 per cent.”