Though MRCB’s annualised 1H11 core net profit made up 79% of our full-year forecast and 81% of consensus, we view it as being broadly in line as we expect a stronger 2H driven mainly by its property division. Property EBIT more than tripled in 1H11, boosted by strata-office sales at KL Sentral. This compensated for the decline in EBIT for other divisions. We make no changes to our FY11-13 forecasts, OUTPERFORM call or RM3.11 target price, which we continue to base on a 10% discount to RNAV. Prospects for the River of Life project, RRI Land and potential award of the LRT extension package B are looking good at all fronts. MRCB remains our top GLC construction pick. Potential share price triggers include (i) project awards, and (ii) progress of the Sg. Buloh land and River of Life project.
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