Hot Stock KUB bounces on expansion plans

by **Cals** Thu 10 Dec 2015, 00:57

Hot Stock

[size=28]KUB bounces on expansion plans

By Gho Chee Yuan / theedgemarkets.com | December 9, 2015 : 11:22 AM MYT

KUALA LUMPUR (Dec 9): KUB Malaysia Bhd ([You must be registered and logged in to see this image.] Valuation: 0.90, Fundamental: 1.15)'s shares price rebounded from a low of 28.5 sen today after the group said it is looking to acquire assets in the information communication and technology (ICT), power and plantation sectors.

At 10.46am, shares of the diversified group was up one sen or 3.51% to trade at 29.5 sen, after surging 1.5 sen or 5.3% at the opening bell.

KUB Malaysia is involved in plantations, properties, food, power, oil and gas and construction and engineering industries. The current price values the company at RM164.16 million.

Trading volume stood at 1.59 million comparable to yesterday's 1.2 million shares.

Shares in KUB has been havouring between 28 sen and 40 sen after it coming off from its one year high of 47 sen on March 17 this year.

Speaking to pressmen in a press conference yesterday, KUB's group managing director Datuk Abdul Rahim Mohd Zin said the group is also looking to double its plantation landbank within two years by acquiring brownfield assets in Indonesia, particularly in Sumatra.

According to him, KUB will be allocating some RM200 million to RM300 million to fund acquisitions.

Aside from that, Abdul Rahim said KUB is also tendering for projects worth RM1 billion in contract value.

“The contracts are for our information and communications technology division, as well as power and oil and gas divisions. We will continue to seek more opportunities in these areas,” he said.

The expansion plans came after the group announced the disposal of two subsidiaries — A&W Restaurants Thailand Co Ltdand KUB Builders Sdn Bhd — for a total of RM3.7 million.

“My goal is to ensure the group’s financial sustainability by eliminating non-core and non-performing assets that do not fit into KUB’s portfolio. This in turn, will lighten our balance sheet by gradually reducing liabilities from our book,” Abdul Rahim said in his first press conference since his appointment on Aug 17.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)
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