KUALA LUMPUR: Kenanga research believes Sunway Construction Group Bhd
may continue to pick up other projects this year given its strong order-book replenishment record in an uncertain market.
This came on the back of SunCon's recent announcement that it had won three new contracts, worth a total of RM496.8mil.
"We raised our FY20E earnings by 4% after factoring in an additional RM300.0m worth of order-book replenishments into our assumptions," it said in a note today.
The research house said the construction player is currently bidding for works in Myanmar and India.
As it stands, SunCon's outstanding orderbook is currently about RM6.2bil, which gives it three years earnings visibility.
SunCon's recent contract announcements bring its job wins this year thus far to RM1.5bil.
The three contracts are the Petronas Leadership Centre, Sunway South Quay's Parcel CP2 project and the Oxley project, which have execution times ranging from 20 to 34 months upon commencement.
The research house said the three contracts would contribute an aggregate of about RM29mil to the bottomline, assuming a pre-tax margin of 8%
Kenanga maintained underperform on the counter with a higher target price of RM1.45, from RM1.40 previously.
