Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: MIDF | Price Call: HOLD | Target Price: 3.76 |
Showing posts with label PUNCAK. Show all posts
Showing posts with label PUNCAK. Show all posts
November 12, 2014
March 13, 2014
Puncak Niaga - Rude Shock
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: MIDF | Price Call: BUY | Target Price: 4.04 |
February 17, 2014
Puncak Niaga - Bunus Job
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: MIDF | Price Call: BUY | Target Price: 4.04 |
December 16, 2013
Puncak Niaga - Early holiday gift
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: MIDF | Price Call: BUY | Target Price: 4.04 |
December 5, 2013
Puncak Niaga - Conditional acceptance
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: MIDF | Price Call: BUY | Target Price: 4.04 |
October 22, 2013
PuncakNiaga - Turning water into oil
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: MIDF | Price Call: BUY | Target Price: 4.04 |
April 16, 2013
RM187m Oil & Gas contract
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: MIDF | Price Call: HOLD | Target Price: 1.32 |
March 8, 2012
Stock Overview - PUNCAK - 8 Mar 2012
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
PUNCAK ( 6807 : 1.43 ) : Stop loss 1.39
Description
Resistance : 1.49 1.64
Support : 1.39
RSI of 51
RSI is on the rise
STOCHASTIC
It riding on an upswing
TREND INDICATOR
Comment
While the upside target of 1.64 remains intact due to positive technicals, a tight stop loss should be placed at yesterday's low of 1.39, which marks the 61.8% pullback level
Trading Strategy
Buy. Stop loss is at 1.39
Source: Jupiter Securities Research 8 March 2012
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: JUPITER | Price Call: BUY | Target Price: 1.64 |
PUNCAK ( 6807 : 1.43 ) : Stop loss 1.39
Description
Resistance : 1.49 1.64
Support : 1.39
RSI of 51
RSI is on the rise
STOCHASTIC
It riding on an upswing
TREND INDICATOR
Comment
While the upside target of 1.64 remains intact due to positive technicals, a tight stop loss should be placed at yesterday's low of 1.39, which marks the 61.8% pullback level
Trading Strategy
Buy. Stop loss is at 1.39
Source: Jupiter Securities Research 8 March 2012
February 29, 2012
Puncak Niaga - Turning to new ventures HOLD
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: AMMB | Price Call: HOLD | Target Price: 1.60 |
Maintain HOLD on Puncak Niaga Holdings with an unchangedfair value of RM1.60/share ' pegged to a 65% discount to its estimated break-up value. Puncak reported a 4QFY11net profit of RM9mil, bringing FY11 net loss to a lower amount of RM9mil vs. aRM72mil loss a year earlier.
Puncak's results came in ahead of both ours, and the street expectationsof full-year losses to the tune of RM20mil and RM31mil, respectively. Thepositive variance, in our view, largely stemmed from a sizeable reversal in itsminority interest position, particularly in 4QFY11 (~RM31mil).
FY11 results were impacted by the adoption of the IC Interpretation12, through retrospective changes to its P&L statement. However, againstlast year's RM72mil loss, this was a significant improvement due tocontributions from its new oil& gas businesses.
We have cut the group's FY12F-13F net profit forecasts by 35%and 19%, respectively, to input higher operating costs for its water divisionand notional interest cost on concession liabilities as a result of IC12. Thistruncates a scheduled tariff hike for SYABAS in 2012 that we continue to assumeand billings from ongoing works for its oil & gas division.
Puncak created some buzz when in 4Q10, it bought out the remaining40% interest in Global Offshore Malaysia and KGL Ltd for a combined US$59mil(~RM177mil).
The new acquisitions are supposed to spearhead Puncak's forayinto the oil & gas sector. Apart from pipe-laying contracts, the group iseyeing a role in the development of marginal oil fields and brownfields.
The group has in recent months also made overtures to expand its scope into other venturesbeyond its water business in Selangor. These include: (i) The privatisation of IndahWater Konsortium (IWK) under a 1MDB-led consortium; and (ii) Scouting for solidwaste management contracts in Cambodia.
But, our call on Puncak remains a HOLD. Prospects for Puncak'snon-water ventures remain fluid at this juncture against an evolving politicalbackdrop.
Its share price hassince retraced by 28% after scaling a high of RM1.89/share earlier this month,after market anticipation on a state-led takeover of water assets in Selangor eventuallyfizzled out.
We would only turn more constructive on the stock when greaterclarity surfaced on the restructuring of Selangor's fragmented water industry.We do not envisage this to happen beforethe 13th General Election.
Source: AmeSeurities
PUNCAK (FV RM1.82 - TRADING BUY) FY11 Results Review: Breezing Through Choppy Waters
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: OSK | Price Call: TRADING BUY | Target Price: 1.82 |
Thanks to timely profit recognition at its constructiondivision, Puncak's core net profit of RM3.7m for FY11 beat our and street projections for a loss. Meanwhile, wereckon the scheduled 25% water tariff hike from 2012 may somewhat help improve earnings, regardless of whetherofficial approval is granted. We are also upbeat on higher revenue from its newly acquired Oil & Gas(O&G) unit and earnings from outstanding pipe laying projects. As the shareprice offers a decent upside to our FV of RM1.82, we are prompted to upgrade Puncak back to a Trading BUY.
Marginally ahead ofexpectation. Excluding thenon-operating income amounting to RM5.6m, Puncak reported a core net profit ofRM3.7m for FY11, which was ahead of our and consensus' projection of a loss.The revenue was 21.7% higher than our numbers, thanks mainly to higherconstruction revenue from its water pipe project and maiden contributionfrom its newly acquired O&G subsidiary. However, the group is allocating more capex and various annual charges directly to itsincome statement (P&L) to comply with accounting standard IC 12, which continues to undermine Syarikat Bekalan Air Selangor SB (Syabas)'s bottomline. That said, the timely profit recognition in its constructiondivision will help to cushion the negative impact.
25% tariff hike andO&G contribution? As provided under the concession agreement, 70%-ownedSyabas is scheduled to receive a 25% water tariff hike from 1 Jan 2012. We donot expect any hike to be implemented as the previously scheduled 30% hike for2009 is still under legal dispute with the Selangor State Government. However,we believe the group will again account for the estimated compensation for thenew water tariffs, which will artificially boost its bottomline. Meanwhile, wealso understand that its newly acquired Global Offshore (M) SB (GOM) hassecured a lucrative O&G pipe maintenance project worth some RM420m, whichwill keep the unit busy this year. This aside, Puncak is also bidding forvarious water projects, with margins for its water and O&G projects estimatedto be in the mid-teens.
Trading BUY. Weexpect Puncak's FY12 profit to hit RM172.4m, incorporating the tariff hikecompensation mentioned earlier, as well as contributions from its O&G andwater pipe-laying projects. Since our last downgrade on the stock, its shareprice accordingly fallen back. Against our original fair value of RM1.82, thestock now provides a decent potential upside of 31%. In light of these factors,we upgrade Puncak back to a Trading BUY. Our fair value is derived from 0.7xFY11 B/V, which was the benchmark used before adjustments for IC Interpretation12.
Source: OSK188
Puncak Niaga Holdings - Watered-down expectations
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: CIMB | Price Call: HOLD | Target Price: 1.45 |
Target RM1.45
Puncak's FY11 core net profit trumped our and consensus forecasts of core net losses. Though above expectations, the results are a non-event given the distortions from IC12. The focus remains on Selangor water
asset takeover prospects, which are still not promising.
asset takeover prospects, which are still not promising.
November 2, 2011
Another financing deal for Puncak Niaga
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Puncak Niaga Holdings Bhd
(Nov 2, RM1.19)
Maintain buy with fair value RM1.82: Puncak Niaga informed Bursa Malaysia on Tuesday that its wholly-owned subsidiary, Puncak Niaga Sdn Bhd (PNSB), has entered into a conditional sale and purchase agreement (SPA) with Acqua SPV Bhd to sell its entire holdings of PNSB redeemable, insecured, coupon bearing notes (JNA notes) to Acqua for a total consideration of RM328.1 million.
Separately, Puncak Niaga said its newly acquired wholly-owned subsidiary, Global Offshore (M) Sdn Bhd (GOM), had accepted syndicated credit facilities from OCBC Bank (M) Bhd and Hong Leong Bank Bhd.
The credit facility, amounting to RM546.9 million, was issued by Puncak Niaga on Nov 20, 2001. It allows note holders to exercise a put option to the company to repurchase all or some of their notes, which fall due on Nov 18, 2011. Puncak Niaga also has a call option that gives the company the right to redeem all outstanding JNA notes at the full outstanding principal amount on the call date. The outstanding principal amount of the notes, including the fifth mandatory partial repayment of RM54.7 million, is RM328.1 million.
We welcome the move to restructure the notes that will push forward the mandatory annual redemption total of RM54.7 million at the original repayment period from 2011 to 2016 to November 2016 to 2019. Already, the group's cash flow is strained amid the prolonged tussle with the Selangor government over the tariff hike and other issues.
Nonetheless, the extended repayment period under the new arrangement will incur a much higher coupon rate of 5.68% per year compared with the previous 2.5% up to Nov 2011 and 3.5% per year thereafter, causing its financing costs to bloat. Acqua is a wholly-owned subsidiary of Pengurusan Aset Air Bhd (PAAB).
OCBC Bank and Hong Leong Bank have granted GOM a US$43.9 million (RM137.4 million) revolving credit, a RM20 million letter of credit (sub-limit), an up to RM50 million bank guarantee and an up to RM95 million foreign currency exchange line. The credit facilities effectively give this new kid on the block a major boost to participate in the lucrative oil and gas (O&G) business.
We understand from Datuk Hashim Mahfar, Puncak Niaga managing director, at the company's last analyst briefing that GOM expects to benefit from Petroliam Nasional Bhd's O&G capital expenditure projects, namely offshore installation and construction (OIC) in the area of replacing old O&G pipelines, platforms and so on.
GOM and SapuraCrest Bhd are the only two players in this segment in Malaysia. Hashim sees RM400 million to RM500 million worth of contracts from Petronas annually over the next four to five years.
We are generally positive on the JNA notes refinancing and syndicated credit facilities obtained by GOM. While the earlier expected participation in Indah Water Konsortium Sdn Bhd's (IWK) potential privatisation is still pending, we see a good 'trading buy' opportunity in Puncak Niaga, especially if its share price drifts down further. We are also keeping our 'fair value' of RM1.82, derived from 0.7 times FY11 book value, which was the benchmark number before IC Interpretation 12 adjustment. ' OSK Research, Nov 2
This article appeared in The Edge Financial Daily, November 3, 2011.
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: OSK | Price Call: BUY | Target Price: 1.82 |
Puncak Niaga Holdings Bhd
(Nov 2, RM1.19)
Maintain buy with fair value RM1.82: Puncak Niaga informed Bursa Malaysia on Tuesday that its wholly-owned subsidiary, Puncak Niaga Sdn Bhd (PNSB), has entered into a conditional sale and purchase agreement (SPA) with Acqua SPV Bhd to sell its entire holdings of PNSB redeemable, insecured, coupon bearing notes (JNA notes) to Acqua for a total consideration of RM328.1 million.
Separately, Puncak Niaga said its newly acquired wholly-owned subsidiary, Global Offshore (M) Sdn Bhd (GOM), had accepted syndicated credit facilities from OCBC Bank (M) Bhd and Hong Leong Bank Bhd.
The credit facility, amounting to RM546.9 million, was issued by Puncak Niaga on Nov 20, 2001. It allows note holders to exercise a put option to the company to repurchase all or some of their notes, which fall due on Nov 18, 2011. Puncak Niaga also has a call option that gives the company the right to redeem all outstanding JNA notes at the full outstanding principal amount on the call date. The outstanding principal amount of the notes, including the fifth mandatory partial repayment of RM54.7 million, is RM328.1 million.
We welcome the move to restructure the notes that will push forward the mandatory annual redemption total of RM54.7 million at the original repayment period from 2011 to 2016 to November 2016 to 2019. Already, the group's cash flow is strained amid the prolonged tussle with the Selangor government over the tariff hike and other issues.
Nonetheless, the extended repayment period under the new arrangement will incur a much higher coupon rate of 5.68% per year compared with the previous 2.5% up to Nov 2011 and 3.5% per year thereafter, causing its financing costs to bloat. Acqua is a wholly-owned subsidiary of Pengurusan Aset Air Bhd (PAAB).
OCBC Bank and Hong Leong Bank have granted GOM a US$43.9 million (RM137.4 million) revolving credit, a RM20 million letter of credit (sub-limit), an up to RM50 million bank guarantee and an up to RM95 million foreign currency exchange line. The credit facilities effectively give this new kid on the block a major boost to participate in the lucrative oil and gas (O&G) business.
We understand from Datuk Hashim Mahfar, Puncak Niaga managing director, at the company's last analyst briefing that GOM expects to benefit from Petroliam Nasional Bhd's O&G capital expenditure projects, namely offshore installation and construction (OIC) in the area of replacing old O&G pipelines, platforms and so on.
GOM and SapuraCrest Bhd are the only two players in this segment in Malaysia. Hashim sees RM400 million to RM500 million worth of contracts from Petronas annually over the next four to five years.
We are generally positive on the JNA notes refinancing and syndicated credit facilities obtained by GOM. While the earlier expected participation in Indah Water Konsortium Sdn Bhd's (IWK) potential privatisation is still pending, we see a good 'trading buy' opportunity in Puncak Niaga, especially if its share price drifts down further. We are also keeping our 'fair value' of RM1.82, derived from 0.7 times FY11 book value, which was the benchmark number before IC Interpretation 12 adjustment. ' OSK Research, Nov 2
This article appeared in The Edge Financial Daily, November 3, 2011.
September 19, 2011
CIMB Research maintains Neutral on Puncak
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
KUALA LUMPUR: CIMB Equities Research is maintaining its Neutral recommendation on PUNCAK NIAGA HOLDINGS BHD [] at a target price of RM1.42, which it still pegged to a 70% discount to its sum-of-parts.
It said on Monday, Sept 19 the outlook for Puncak remains anchored to the takeover of water assets in Selangor which shows no signs of progress.
It said the main takeaway from The Edge's article on the potential takeover/privatisation of Indah Water Konsortium (WK) by 1MDB and Puncak is that Puncak is likely to be roped in to turn around IWK's operations.
'Our view is that the move is positive for the industry but may not be good timing for Puncak given the deadlock on the takeover of water assets in Selangor.
'A stake in IWK would be negative for Puncak's earnings as IWK is loss-making. However, it would enhance its SOP value by 3%-4% based on the transaction value used when Ministry of Finance acquired IWK in 2000,' it said.
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: CIMB | Price Call: HOLD | Target Price: 1.42 |
KUALA LUMPUR: CIMB Equities Research is maintaining its Neutral recommendation on PUNCAK NIAGA HOLDINGS BHD [] at a target price of RM1.42, which it still pegged to a 70% discount to its sum-of-parts.
It said on Monday, Sept 19 the outlook for Puncak remains anchored to the takeover of water assets in Selangor which shows no signs of progress.
It said the main takeaway from The Edge's article on the potential takeover/privatisation of Indah Water Konsortium (WK) by 1MDB and Puncak is that Puncak is likely to be roped in to turn around IWK's operations.
'Our view is that the move is positive for the industry but may not be good timing for Puncak given the deadlock on the takeover of water assets in Selangor.
'A stake in IWK would be negative for Puncak's earnings as IWK is loss-making. However, it would enhance its SOP value by 3%-4% based on the transaction value used when Ministry of Finance acquired IWK in 2000,' it said.
September 12, 2011
Not takeover target, but may partner 1MDB for IWK
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: AMMB | Price Call: HOLD | Target Price: 1.60 |
CIMB Research maintains Neutral on Puncak Niaga
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
KUALA LUMPUR: CIMB Equities Research said it is maintaining its Neutral call or RM1.42 target price, which it continues to peg to a 70% discount to its sum-of-parts value.
'Prospects for Puncak remain anchored to the takeover of water assets in Selangor, which shows no signs of progress,' it said on Monday, Sept 12.
The research house said though the government's move to privatise Indah Water Konsortium may benefit Puncak as it would give the group another concession, it is not excited about it as negotiations could be protracted and politics could get in the way.
'Puncak's share price, which shot up 12.3% last Friday on speculation that 1MDB is looking to acquire the company, may come under pressure following a denial by Puncak's management.
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: CIMB | Price Call: HOLD | Target Price: 1.42 |
KUALA LUMPUR: CIMB Equities Research said it is maintaining its Neutral call or RM1.42 target price, which it continues to peg to a 70% discount to its sum-of-parts value.
'Prospects for Puncak remain anchored to the takeover of water assets in Selangor, which shows no signs of progress,' it said on Monday, Sept 12.
The research house said though the government's move to privatise Indah Water Konsortium may benefit Puncak as it would give the group another concession, it is not excited about it as negotiations could be protracted and politics could get in the way.
'Puncak's share price, which shot up 12.3% last Friday on speculation that 1MDB is looking to acquire the company, may come under pressure following a denial by Puncak's management.
September 9, 2011
Puncak Niaga upgraded, stock jumps
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Puncak Niaga Holdings Bhd rose the most in 34 months after OSK Holdings Bhd upgraded the stock following a Business Times report the Malaysian water treatment operator may join a group to take over the national sewerage company.
The stock jumped 17 percent to RM1.33 at 11:02 a.m. local time in Kuala Lumpur trading, set for its biggest gain since Nov. 3, 2008.
OSK raised its stock rating to "trading buy" from "neutral," it said in a report today. -- Bloomberg
Company Name: PUNCAK NIAGA HOLDINGS BHD
| Research House: OSK | Price Call: TRADING BUY | Target Price: 1.82 |
Puncak Niaga Holdings Bhd rose the most in 34 months after OSK Holdings Bhd upgraded the stock following a Business Times report the Malaysian water treatment operator may join a group to take over the national sewerage company.
The stock jumped 17 percent to RM1.33 at 11:02 a.m. local time in Kuala Lumpur trading, set for its biggest gain since Nov. 3, 2008.
OSK raised its stock rating to "trading buy" from "neutral," it said in a report today. -- Bloomberg
June 14, 2011
PUNCAK - Puncak Niaga an emerging O&G player
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Research House: RHB
Puncak Niaga Holdings Bhd
(June 14, RM2.17)
Maintain trading buy at RM2.17 with fair value of RM3.05: Going forward, Puncak hinted of more news flow in terms of O&G contracts, though it declined to provide specific details. We view the impending news flow positively as it indicates Puncak will have an alternative core business to fall back on should the ongoing water restructuring end with Puncak not having an operations & maintenance (O&M) contract. Puncak is keen on turning O&G into a significant earnings contributor going forward, and that growth will be driven by M&A.
We gather from management that although Puncak Niaga is in talks with Bourbon, the focus is on chartering Bourbon's vessels to support Puncak's growing O&G activities, instead of being an agent for Bourbon. Recall that The Edge Financial Daily had reported on June 8 that Puncak was in talks with Bourbon to be the latter's agent for Southeast Asia, citing industry sources.
We understand the vessels will be chartered for supporting the recently acquired pipe laying barge (DLB 264) since the barge is quite old (43 years old) and lacks a propeller engine to move on its own. Also, there are no plans to acquire such vessels as these are costly and used only intermittently to move the barge.
While details are still sketchy at the moment, management has hinted of developing marginal O&G reserves and operating a deepwater supply base in Sabah as among the other scope of O&G work that Puncak is currently exploring. Management said studies are still ongoing and the related capex will be funded via borrowings.
No changes made to earnings forecasts.
The risks include: (1) No compensation for the delayed 37% scheduled tariff hike; (2) 37% scheduled tariff hike is not granted; (3) Higher-than-expected variable costs, in particular, chemical costs; and (4) Little progress in water sector restructuring.
Puncak's indicative fair value is maintained at RM3.05 at a 20% discount to its DCF-derived NPV of RM3.81/share (based on WACC of 11.5%).
We see the O&G business offering better growth prospects vis-''-vis Puncak's mature core water business, though its lack of track record translates into increased earnings risk for the group. With the impending buyout of the water bonds, we are cautiously optimistic that the water sector restructuring will finally make some progress provided the following issues are addressed: (1) The pricing issue (2) The tussle for the lucrative operation and maintenance contract post restructuring. Maintain 'trading buy'. 'RHB Research, June 14
This article appeared in The Edge Financial Daily, June 15, 2011.
Company Name: PUNCAK NIAGA HOLDINGS BHD
Research House: RHB
Puncak Niaga Holdings Bhd
(June 14, RM2.17)
Maintain trading buy at RM2.17 with fair value of RM3.05: Going forward, Puncak hinted of more news flow in terms of O&G contracts, though it declined to provide specific details. We view the impending news flow positively as it indicates Puncak will have an alternative core business to fall back on should the ongoing water restructuring end with Puncak not having an operations & maintenance (O&M) contract. Puncak is keen on turning O&G into a significant earnings contributor going forward, and that growth will be driven by M&A.
We gather from management that although Puncak Niaga is in talks with Bourbon, the focus is on chartering Bourbon's vessels to support Puncak's growing O&G activities, instead of being an agent for Bourbon. Recall that The Edge Financial Daily had reported on June 8 that Puncak was in talks with Bourbon to be the latter's agent for Southeast Asia, citing industry sources.
We understand the vessels will be chartered for supporting the recently acquired pipe laying barge (DLB 264) since the barge is quite old (43 years old) and lacks a propeller engine to move on its own. Also, there are no plans to acquire such vessels as these are costly and used only intermittently to move the barge.
While details are still sketchy at the moment, management has hinted of developing marginal O&G reserves and operating a deepwater supply base in Sabah as among the other scope of O&G work that Puncak is currently exploring. Management said studies are still ongoing and the related capex will be funded via borrowings.
No changes made to earnings forecasts.
The risks include: (1) No compensation for the delayed 37% scheduled tariff hike; (2) 37% scheduled tariff hike is not granted; (3) Higher-than-expected variable costs, in particular, chemical costs; and (4) Little progress in water sector restructuring.
Puncak's indicative fair value is maintained at RM3.05 at a 20% discount to its DCF-derived NPV of RM3.81/share (based on WACC of 11.5%).
We see the O&G business offering better growth prospects vis-''-vis Puncak's mature core water business, though its lack of track record translates into increased earnings risk for the group. With the impending buyout of the water bonds, we are cautiously optimistic that the water sector restructuring will finally make some progress provided the following issues are addressed: (1) The pricing issue (2) The tussle for the lucrative operation and maintenance contract post restructuring. Maintain 'trading buy'. 'RHB Research, June 14
This article appeared in The Edge Financial Daily, June 15, 2011.
May 24, 2011
PUNCAK - OSK holds trading 'buy' on Puncak Niaga
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Research House: OSK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Research House: OSK
OSK Research is holding a trading "buy" recommendation for Puncak Niaga Holdings, although it secured a Sarawak contract
that lifts earnings estimates slightly.
Puncak Niaga announced that via a 40:60 joint venture with Quality Concrete Holdings, it had secured a contract worth RM667.32 from the Ministry of Rural and Regional Development.
The contract is for the supply, construction and commission of water supplies facilities for the rural areas in Sarawak for a period of 28 months.
"Though the addition has lifted our earnings estimates for Puncak slightly, we hold our trading buy recommendation for Puncak with its fair value at RM3.65 per share unchanged, based on historical book value," OSK said in a research note today.
OSK conservatively reckons the project commencement to be in June without any backdated revenue recognition.
The research house said although the project benefits the company as it has not secured a construction contract for some time, the marginal earnings increment to its bottom line, does not significantly raise its valuation. -- Bernama
that lifts earnings estimates slightly.
Puncak Niaga announced that via a 40:60 joint venture with Quality Concrete Holdings, it had secured a contract worth RM667.32 from the Ministry of Rural and Regional Development.
The contract is for the supply, construction and commission of water supplies facilities for the rural areas in Sarawak for a period of 28 months.
"Though the addition has lifted our earnings estimates for Puncak slightly, we hold our trading buy recommendation for Puncak with its fair value at RM3.65 per share unchanged, based on historical book value," OSK said in a research note today.
OSK conservatively reckons the project commencement to be in June without any backdated revenue recognition.
The research house said although the project benefits the company as it has not secured a construction contract for some time, the marginal earnings increment to its bottom line, does not significantly raise its valuation. -- Bernama
PUNCAK - Puncak Niaga raised to 'trading buy'
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Research House: CIMB
Company Name: PUNCAK NIAGA HOLDINGS BHD
Research House: CIMB
Puncak Niaga Holdings Bhd was raised to “trading buy” from “neutral” at CIMB Investment Bank Bhd after the Malaysian company announced plans to venture into the oil and gas industry and it won a water supply contract in Sarawak state.
The share estimate was increased to RM3.03 from RM2.72, Sharizan Rosely, an analyst at Kuala Lumpur-based CIMB, wrote in a report today. -- Bloomberg
The share estimate was increased to RM3.03 from RM2.72, Sharizan Rosely, an analyst at Kuala Lumpur-based CIMB, wrote in a report today. -- Bloomberg
February 25, 2011
PUNCAK - Puncak unlikely to receive compensation
Stock Name: PUNCAK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Research House: OSK
Company Name: PUNCAK NIAGA HOLDINGS BHD
Research House: OSK
It is highly unlikely that the Selangor government will pay RM853 million in water tariff compensation to Puncak Niaga Holdings anytime soon, says OSK Research.
Due to the delay in receiving the water tariff compensation from the state government since 2009, the sum amounted to RM418.7 million in 2010.
Added to the sum payable of RM434.2 million in 2009, the company expected to receive RM853 million in cash from the Selangor govenment, OSK said.
"However, with regards to the strained relationship between Puncak and the Selangor government, we believe it is very unlikely," it said in a research note today.
The company commenced legal proceedings against the Selangor government for compensation amounting to RM471.6 million for the financial year 2010.
The company's pre-tax profit in the financial year ended Dec 31, 2010 fell to RM268.396 millionm from RM312.606 million chalked up in the same period a year ago, due to higher operating and finance costs incurred.
Revenue, however, rose to RM1.914 billion from RM1.887 billion previously due to higher water consumption.
OSK also revised downwards Puncak's target price to RM3.65 from RM3.85 previously and downgraded the stock to a "trading buy" from "buy" previously given the urgency and recent commitment by the Federal Government.
"We reckon a timeline for completion is still uncertain," it added.
Meanwhile, ECMLibra Investment Research maintained a "hold" call for Puncak but revised the earning estimates downwards to 11.6 per cent to account for higher interest expense.
"We roll forward our valuation to financial year 2011, thereby decreasing our target price from RM2.57 previously to RM2.16," ECMLibra said. -- Bernama
Due to the delay in receiving the water tariff compensation from the state government since 2009, the sum amounted to RM418.7 million in 2010.
Added to the sum payable of RM434.2 million in 2009, the company expected to receive RM853 million in cash from the Selangor govenment, OSK said.
"However, with regards to the strained relationship between Puncak and the Selangor government, we believe it is very unlikely," it said in a research note today.
The company commenced legal proceedings against the Selangor government for compensation amounting to RM471.6 million for the financial year 2010.
The company's pre-tax profit in the financial year ended Dec 31, 2010 fell to RM268.396 millionm from RM312.606 million chalked up in the same period a year ago, due to higher operating and finance costs incurred.
Revenue, however, rose to RM1.914 billion from RM1.887 billion previously due to higher water consumption.
OSK also revised downwards Puncak's target price to RM3.65 from RM3.85 previously and downgraded the stock to a "trading buy" from "buy" previously given the urgency and recent commitment by the Federal Government.
"We reckon a timeline for completion is still uncertain," it added.
Meanwhile, ECMLibra Investment Research maintained a "hold" call for Puncak but revised the earning estimates downwards to 11.6 per cent to account for higher interest expense.
"We roll forward our valuation to financial year 2011, thereby decreasing our target price from RM2.57 previously to RM2.16," ECMLibra said. -- Bernama
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