Stock Name: SIME
Company Name: SIME DARBY BHD
Stock Name: SIME
Company Name: SIME DARBY BHD
Kenanga Research is positive on Sime Darby Bhd's decision to award Zecon Bhd a RM82.97 million contract to build a 10-storey commercial building in Taman Melawati, Setapak, namely "Melawati
Corporate Centre".
"We reckon that the award to Zecon looks fair as its tender was the lowest.
"In addition, Sime Darby is protected in the event of any delays due to the existence of penalty clause of RM36,700 per day," it said in a research note today.
The research house said the conglomerate would likely rent out the offices once they were completed in mid-2015 and this should bode well for Sime Darby's property division.
"We are positive on the deal as increased sustainable earnings from the property division should reduce Sime Darby's dependency on its plantation division, which is exposed to crude palm oil price volatilities," it added.
Kenanga Research maintained a 'market perform' on Sime Darby's share price, with an unchanged target price of RM9.80.
The research house also said Sime Darby's award of a construction contract to Zecon and en-bloc sale of an office tower at its Oasis Square development in Ara Damansara, Petaling Jaya, for RM124.5 million, was part of its ordinary course of property development business.
"Pricing for the disposal is fair in our opinion," the research firm said.
RHB Research maintains a 'buy' call on Sime Darby, with a target price of RM10.40.-- Bernama
Company Name: SIME DARBY BHD
| Research House: KENANGA | Price Call: HOLD | Target Price: 9.80 |
Stock Name: SIME
Company Name: SIME DARBY BHD
| Research House: RHB | Price Call: BUY | Target Price: 10.40 |
Kenanga Research is positive on Sime Darby Bhd's decision to award Zecon Bhd a RM82.97 million contract to build a 10-storey commercial building in Taman Melawati, Setapak, namely "Melawati
Corporate Centre".
"We reckon that the award to Zecon looks fair as its tender was the lowest.
"In addition, Sime Darby is protected in the event of any delays due to the existence of penalty clause of RM36,700 per day," it said in a research note today.
The research house said the conglomerate would likely rent out the offices once they were completed in mid-2015 and this should bode well for Sime Darby's property division.
"We are positive on the deal as increased sustainable earnings from the property division should reduce Sime Darby's dependency on its plantation division, which is exposed to crude palm oil price volatilities," it added.
Kenanga Research maintained a 'market perform' on Sime Darby's share price, with an unchanged target price of RM9.80.
The research house also said Sime Darby's award of a construction contract to Zecon and en-bloc sale of an office tower at its Oasis Square development in Ara Damansara, Petaling Jaya, for RM124.5 million, was part of its ordinary course of property development business.
"Pricing for the disposal is fair in our opinion," the research firm said.
RHB Research maintains a 'buy' call on Sime Darby, with a target price of RM10.40.-- Bernama
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