INTA Bina Group Bhd being able to secure a RM199 mil project is a timely boost to its orderbook, according to TA Securities.
“The job win comes in as a timely boost to its order book, raising it to a healthier level of around RM625 mil currently,” said TA analyst Ooi Beng Hooi.
This, the analyst noted, could turn into an estimated RM9 mil in net earnings contribution throughout the construction period, assuming a 10% gross margin.
The contract was from Tropicana Metropark Sdn Bhd, an indirect wholly owned subsidiary of Tropicana Corporation Bhd, as the main contractor for Phase 1 of Tropicana Metropark, a mixed commercial development project in Subang Jaya.
It is a fixed-price contract, and consists of 30-storey apartments, a 9-storey podium, 1 storey of commercial lots, and a basement carpark. The construction work is scheduled to begin Aug 24, with a project duration of 39 months.
“Following this job win, we raise our FY2020 order book replenishment assumption from RM200 mil to RM300 mil,” said Ooi.
TA upgraded its call for Inta to a buy from a previous hold, with an increased target price of 28 sen.
“Despite the challenging outlook for the building construction sector, we believe Inta will be able to sail through the rough seas. In fact, we opine that its existing and potential clients, mainly property developers, would prefer to appoint reliable building contractors such as Inta, which is backed by a proven track record in terms of timely completion and work quality as well as a solid balance sheet to ensure the smooth, successful and timely delivery of projects,” said Ooi.
At the end of the trading day, Inta’s shares were last done at 25.5 sen, up a sen, with 6.5 million shares traded. – Aug 18, 2020
