Stock Name: MUHIBAH
Company Name: MUHIBBAH ENGINEERING (M) BHD
Research House: CIMB
KUALA LUMPUR: CIMB Equities Research begins coverage on Muhibbah Engineering Bhd with a Trading Buy call and target price of RM2, pegged to a 20% discount to its RNAV.
The research house said on Thursday, Nov 11 that the company is'' a midsized contractor that has diversified into cranes, shipbuilding and airport/road maintenance concessions.
'In addition to riding on the improving outlook for project flows in both the local and overseas markets, Muhibbah may soon see a resolution to the payment issue for the Asia Petroleum Hub project, which has been a major drag on its share price.
In addition to the likely resolution of the APH project, CIMB Research said the share price could be catalysed by (i) better-than-expected quarterly performances, (ii) more contract wins, and (iii) a recovery in investors' sentiment on the stock as its foreign shareholding has plunged from 41% in 2007 to a low of 6% now.
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