Published: Monday June 18, 2012 MYT 8:45:00 AM
Updated: Monday June 18, 2012 MYT 3:10:46 PM
RHB Research upgrades MRCB to Trading Buy
KUALA LUMPUR: RHB Research Institute has upgraded Malaysian Resources Corp Bhd to Trading Buy from Market Perform and raised the fair value by 10% from RM1.83 to RM2.02.
It said on Monday the government will make good toll revenues foregone of the Eastern Dispersal Link (EDL) in Johor (of which tolling did not commence on 1 May as scheduled).
RHB Research said MRCB believes that the long awaited Rubber Research Institute (RRI) land redevelopment project may finally get off the ground in 2H with formal land acquisition by Kwasa Land, followed by the call for tender for infrastructure works and the parceling out of development land plots.
“MRCB's near-term earnings visibility is good on the back of strong construction profits underpinned by successful variation order (VO) claims and its expectations of at least RM1bil worth of new jobs this year, and strong property profits underpinned by property development and investment profits from KL Sentral,” it said.
RHB Research said it now sees value in MRCB after a steep decline in share price.
“Fair value is raised by 10% from RM1.83 to RM2.02, having rolled forward our base year for valuation purpose from FY12/12 to FY12/13. Upgrade MRCB to Trading Buy from Market Perform,” it said.