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Published: Wednesday November 14, 2012 MYT 11:18:00 AM

MMC Corp advances after Malakoff JV gets US$300m Oman job

KUALA LUMPUR: Shares of MMC Corporation Bhd rose on Wednesday after its subsidiary Malakoff Bhd and its joint venture partners secured a US$300mil independent water project in Oman.

At 11am, MMC was up nine sen to RM2.74. There were 196,000 shares done at prices ranging from RM2.68 to RM2.74.

The FBM KLCI was up 1.03 points to 1,638.62. Turnover was 242.27 million shares valued at RM326.26mil. Market sentiment improved with 211 gainers, 192 losers and 253 counters unchanged.

MMC's 51% Malakoff Corporation Bhd-led consortium was selected as the successful bidder to build an independent water project with a net desalination capacity of 42 MIGD (equivalent to 191,000 cubic meters a day), at Al Ghubrah, Muscat.

Affin Investment Research said overall, the above project win is positive to Malakoff.

"If we were to assume that this infrastructure project internal rate of returns is around 8%, the net earnings impact (on a 45% equity interest by Malakoff) is limited to 2.5% (on full year earnings beyond FY14).

"NPV enhancement (to our RNAV) is also limited to RM135mil (or 1.1% of RNAV). We also assume the project will be able to secure a ring-fenced project finance option. Maintain ADD with an unchanged RNAV-based TP of RM2.80 a share," it said.

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