PETALING JAYA: Serba Dinamik Holdings Bhd
’s operations and maintenance (O&M) business will remain strong in 2019, while its engineering, procurement, construction and commissioning (EPCC) division is set to chalk a stronger performance.
RHB Research said the group’s O&M business is expected to maintain its performance this year, with Middle East demand for its services remaining robust, even as it continues to penetrate into the Africa and Central Asia markets.
The EPCC division, on the other hand, is expected to record a stronger performance this year, with the construction of multiple projects set to be ramped up, totalling RM1bil.
The projects include the Kuala Terengganu water treatment plant, Tanzania chlor-alkali plant, Kota Marudu and Laos hydropower plants.
The research house, which reiterated its ‘buy’ call on the counter with a higher target price of RM4.72, said it continued to like the stock due to its sustained growth in O&M globally, with further legs of growth stemming from its upcoming asset ownership portfolio (mostly associate stake).
This, it said, was coupled with inroads into Pengerang, Johor through the Pengerang Integrated Development (PID) project.
“Downside risks to our call are cost overruns of EPCC projects and plant downtime on associate-owned plants,” it said.
RHB Research said Serba Dinamik’s full-year core profit had come in in line with its and Street estimates.
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