Kelington rises as Affin Hwang initiates coverage

KUALA LUMPUR: Shares in Kelington Group Bhd were on the move in early trade as Affin Hwang Capital Research initiated coverage on the counter with a buy rating.

At 9.28am, the stock was up nine sen or 8.65% to RM1.13 on the back of 3.76 million shares done.

The research house said in its report that Kelington's venture into the business of supplying industrial gases should help to provide a long-term recurring income stream to the group. 

It expects the progressive ramp-up at its LCO2 plant and future expansion projects to be key earnings re-rating catalysts in the coming years, which would also help to lift the overall group margin.

"Once the first plant is up and running by September 2019, the group will effectively be the second largest liquid carbon dioxide (LCO2) player in town," said Affin Hwang Capital, which initiated coverage on the counter with a buy rating and target price of RM1.60.