AmInvest Research keeps 'buy' on Serba Dinamik


KUALA LUMPUR: AmInvestment Research maintained its "buy" call and fair value for Serba Dinamik Holdings following the completion of its book-building exercise for its private placement.

In its research note on Monday, it had a fair value of RM2.20 a share, based on a slightly lowered 22% discount to its diluted sum-of-parts valuation of RM2.83 a share.

It said its forecasts has been revised to account for the RM509mil gross proceeds, which reduce the group's FY21 forecast net gearing from 0.7 times currently to 0.4 times, while diuting FY21-22 forecast earnings per share by 6%.

"With the recent retracement in Serba’s share price, the stock is currently trading at a highly compelling FY21F PE of only nine times for an operation and maintenance service provider with a recurring income profile, while offering an attractive dividend yield of 5%," it said.

In comparison, Dialog Group currently trades at a price-earnings of over 30 times.

Serba Dinamik recently completed the book-building exercise for its 10% private placement with the issuance of 336.8 million new shares at RM1.51 a share, an 8% discount to the five-day volume weighted average market price.

AmInvestment said the group is poised for stronger order book growth with the recent aquisition of the RM320mil Teluk Ramunia yard, which enhances and substantively expands its existing strategic presence in Pengerang's Refinery and Petrochemical Integrated Development.

It believes the group's order book has increased slightly by 1% quarter-on-quarter at RM18.7bil, exceeding the group's earlier FY20 forecast target of RM15bil set at the start of 2020.

"While management has yet to provide fresh guidance for the group’s year-end 2021 order book, we expect additional contracts later this year as Serba aims to lease parts of the 170-acre Teluk Ramunia yard to third parties while angling for fresh jobs in decommissioning, petrochemicals and renewable sectors," said AmInvestment.
Article type: metered
User Type: anonymous web
User Status:
Campaign ID: 18
Cxense type: free
User access status: 3
   

Did you find this article insightful?

Yes
No

100% readers found this article insightful

Next In Business News

MyEG posts RM75.5mil net profit in Q4
ANALYSIS: Top Glove bets on pandemic boom to propel ambitious US$1.9bil HK listing
Datasonic eyes Vietnam e-passport opportunity�
Yinson's unit bags RM1.5bil solar project in India�
Deloitte to pay RM324mil in settlement over 1MDB and SRC�
BIMB Investment launches Makmur myWakaf Fund
KLCI extends gains, closes 18 points higher
MISC’s ethane carrier Seri Everest delivers cargo in China
GlobalFoundries pours US$1.4b into fab expansion
Oil rises as U.S. vaccine progress raises demand expectations

Stories You'll Enjoy


Vouchers