Business

Tuesday April 7, 2009

WCT share price climbs to 4-month high

By IZWAN IDRIS


PETALING JAYA: WCT Bhd’s share price hit a four-month high yesterday on hopes that it would be able to secure two new infrastructure projects in Sabah worth RM500mil in the coming months.

A local bank-backed brokerage yesterday said WCT was in the process of converting letters of intent (LOIs) for the two projects, believed to be a road work and a water supply related job in Sabah, into actual letters of award (LOAs).

The firm said the key hurdle would be funding for the projects but this was expected to be resolved soon as the Government had allocated a substantial amount for infrastructure development projects in Sabah.

Meanwhile, AmResearch said in an update yesterday that it expected WCT to firm up the contracts for at least two domestic jobs within the next six months.

A WCT spokesman declined comment on the research reports when contacted by StarBiz yesterday. In the past, WCT would only make an announcement to Bursa Malaysia after it had secured the LOA for any construction jobs.

Last month, WCT told analysts at its results briefing that it was aiming to secure RM1bil worth of new projects this year, with an even split between domestic and overseas work.

Current outstanding orderbook value was estimated at RM3.3bil. In-house jobs accounted for about RM600mil of the total amount.

Shares of WCT, along with other big construction firms like IJM Corp Bhd and Gamuda Bhd had rallied in the past week as investors whetted their appetite for cyclical stocks amid the improved market sentiment.

This was boosted by optimism that these companies would benefit from increased spending on development work by the Government over the next two years.

WCT shares rose 10 sen yesterday, or 7.9% to close at RM1.36 with 16.4 million shares traded. The stock has gained 17% over the past one week.

WCT currently has a strong presence in Sabah. Ongoing projects in the state include a RM720mil upgrading work at the Kota Kinabalu International Airport and a RM151mil water supply project in Kudat.

The firm has established a strong track record, being involved in the construction of Qatar’s new international airport and the KL International Airport (KLIA) in Sepang.

This puts it in a good stead to bid for the job to build the permanent low-cost carrier terminal at KLIA, which is expected to start this year.


WCT : [Stock Watch] [News]


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