January 17, 2011

BENALEC - Benalec soars on debut

Stock Name: BENALEC
Company Name: BENALEC HOLDINGS BERHAD
Research House: AMMB

KUALA LUMPUR: Shares of Benalec Holdings Bhd surged at the start of trade on Monday, Jan 17, making its debut at RM1.36, which was 36 sen above its offer price of RM1.

At 9am, there were 12 million shares of the integrated marine engineering specialist transacted.

The FBM KLCI rose 3.32 points to 1,573.21. Turnover was 38.71 million shares valued at RM33.40 million. Advancers led decliners 155 to 26 while 95 stocks were unchanged.

AmResearch has a Buy call and a sum of parts-derived fair value of RM1.90. The research house said Benalec enjoys an 18% share of the Malaysian marine CONSTRUCTION [] market dominated by only five major active players.

Meanwhile, OSK Research has target price of RM1.42, based on the sum-of-parts method, implying a strong 42% upside.

It said the company is involved in marine engineering in which it has an 18% market share. Its business model is unique in that it also accepts the reclaimed land as payment.

'Margins are above the construction sector average. We see more reclamation jobs from Melaka, Penang and Johor. There is also potential to expand into land scarce Singapore. Our RM1.42 TP, based on the SOP method, implies a strong 42% upside,' OSK Research said.

No comments:

Post a Comment