BIMB Securities upgrades Dayang to Buy, raises target price

Business & Markets 2013
Written by theedgemalaysia.com
Tuesday, 07 May 2013 09:45
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KUALA LUMPUR (May 7): BIMB Securities has upgraded Dayang
Enterprise to a Buy (from Neutral) at RM3.74 with a higher target price
of RM4.48 (from RM2.87), and said that after some delays, Dayang
had finally secured its first piece of the long term RM10 billion Pan
Malaysia HUC tenders by oil and gas operators in Malaysia. The 5+1
year contract is valued at RM313.6m and is awarded by Murphy
Sarawak.
In a note Tuesday, the research house said that as Dayang was also
tendering for other pieces of the HUC, it expects more contracts in the
pipeline.
“We upgraded our FY13 and FY14 earnings by 15% and 35%
respectively, as we are now adding additional RM600 million of HUC win
rate into our assumptions.
“Simultaneously, given the end of GE13, we are now seeing event risk
to taper off as such we are reverting our valuation for Dayang from 12.5x back to 14.5x, valuing the stock at RM4.48 as we
roll-over our valuation to FY14 earnings taking advantage of its bright prospects,” it said.