CIMB upgrades 'outperform' for Gamuda

CIMB Research has upgraded from 'neutral' to 'outperform' rating for
Gamuda Bhd with a higher target price of RM5.60 from RM3.98 as the Mass
Rapid Transit (MRT) should re-emerge as Gamuda's next source of growth
with one of the two lines likely to be launched in the second half of
this year.

"Gamuda's competitive edge stems from its role as the
main contractor for MRT tunnelling work and project development partner
for the above-ground portion," it said in a research note today.

In addition, it said, the KL-Singapore High-Speed Rail and Johor
Baharu-Singapore Rapid Transit System were new opportunities on top of MRT, potentially providing further catalyst.

"Gamuda is one of our top sector picks," CIMB Research said.

For
this year and next year, it said, Gamuda was vying for more than RM10
billion worth of new contracts, mainly from MRT 2 and 3 and the
Gemas-Johor Baharu double-tracking project.

"Other potential
positives are the likely disposal of its stake in highway operators
Sistem Penyuraian Trafik KL Barat Holdings Sdn Bhd or Sprint and
Lingkaran Trans Kota Holdings Bhd or Litrak, which eventually will lead
to special dividends," it added.-- Bernama