Construction (Overweight) - Bridging to Bangladesh

Stock Name: MRCB
Company Name: MALAYSIAN RESOURCES CORP

Research House: HLG

Price Call: BUY

Target Price: 2.50

Stock Name: SENDAI
Company Name: EVERSENDAI CORPORATION BERHAD

Research House: HLG

Price Call: BUY

Target Price: 2.00

Stock Name: IJM
Company Name: IJM CORPORATION BHD

Research House: HLG

Price Call: HOLD

Target Price: 5.77

Construction (Overweight)

Bridging to Bangladesh

• The Government of Malaysia (GoM) has inked a MoU with Bangladesh for the construction of a 6.15kmbridge across the Padma River for US$2.9bn(RM8.7bn). The Padma Multipurpose Bridgewill connect the south-west region of Bangladesh to the rest of thecountry and will be the largest bridge project in the country.
• The project will be undertaken by a consortium of 5 contractors and willnegotiate directly with the Bangladeshi Government after the GoM haveshortlisted the contractors. The contenders are understood to be currentlyundertaking the second Penang Bridge project. Thecompanies slated for selection are United Engineers, MRCB (BUY, TP: RM2.50),PAG Consult (NR) and Eversendai (BUY, TP: RM2.00). Although IJM (HOLD, TP:RM5.77) has not been mentioned in the news, we believe that they could also beone of the contenders.
• With the current pullback in construction stock prices, we believe thatit poses an opportunity to accumulate. Thus, we maintain our OVERWEIGHT stanceon the sector.

Source: HLIB Research - 12 April 2012