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Tuesday, November 1, 2011

TRC - Positive Contract Flow Momentum (OSK)

TRC announced yesterday that it has been awarded a RM51.4m contract from the Ministry of Works for the infrastructure upgrade of the Lumut Jetty in Perak.

Raising FV to RM0.81. Following the increase in our orderbook target from RM400m to RM500m, our FY11-13 earnings are raised by 2%, 10.9% and 8.9% respectively. The key risk to our earnings projection are continued delays in the Kelana LRT-A extension job (RM950m). We maintain our TRADING BUY rating on TRC based on a fully diluted RNAV (imputing a 10x construction PER on FY12 earnings).

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