RHB Research retains ‘buy’ call on ML Global


  • Business
  • Saturday, 25 Nov 2017

PETALING JAYA: RHB Research has reiterated its “buy” call on ML Global Bhd, on the back of the company’s financial performance this year which has trumped expectations.

With an unchanged target price of RM1.82, the research house remains positive on the group, given its strong order book replenishment potential. Year-to-date, ML Global has secured new job wins amounting to RM1.7bil.

In the third quarter of financial year 2017 (3Q17), ML Global’s core net profit grew by 27.8% quarter-on-quarter (q-o-q) to RM12.8mil, driven by a higher top line and the contribution from its sole property development project, Zenopy Residences.

The company’s revenue in the third quarter rose by 8.8% q-o-q to RM185.3mil, primarily attributed to the encouraging take-up rate in its Zenopy Residences project.

Cumulatively, in the first nine months of financial year 2017 (9M17), the construction outfit recorded a core net profit of nearly RM31.1mil.

“ML Global’s 9M17 core net profit of RM31.1mil came in above our expectations and accounts for 84% of our full-year forecast. We attribute its performance to the faster-than-expected construction works progress.

“As its 9M17 results are better than what we estimated, we raise our FY17 net profit forecast by 6%, after imputing ML Global’s faster construction works progress.

“However, we keep our FY18-19 earnings estimates unchanged,” the research house said in a note.

Moving forward, RHB Research said that ML Global’s earnings growth prospects would be supported by its outstanding order book of RM2.4bil, which provides solid earnings visibility over the next two to three years.

In addition, the group’s investment and exposure in the industrialised building system (IBS) manufacturing plant segment is expected to make it more appealing to investors.


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