PETALING JAYA: WCT Holdings Bhd
’s familiarity with the Middle East region, along with its partnership with an established local contractor, should help minimise execution risks for its latest Abu Dhabi contract win, Hong Leong Investment Bank (HLIB) Research says.
The group announced that it has, through its 50:50 joint venture (JV) with United Arab Emirates-based Construction General Contracting House Ltd, secured a subcontract worth RM529mil for a project owned and developed by Aldar Development LLC, known as the Yas Living Main Works Package. WCT’s 50% share of the contract amounts to RM264.5mil.
HLIB Research viewed the contract win positively, as it highlights WCT’s efforts to diversify away from reliance on the domestic market and increase its focus on building works amid sluggish local infrastructure job flows.
Despite prevailing geopolitical uncertainties posing execution risks, the research house said WCT’s prior operating experience in the Middle East and its local JV partner should help mitigate these challenges.
HLIB Research reiterated its “buy” call on WCT, with an unchanged target price of 73 sen, adding that continued job wins from its RM14bil tender book could support a re-rating of the stock.
