5th June, 2018
KUALA LUMPUR: CIMB Equities Research starts coverage of Benalec Holdings with a Trading Buy instead of an Outperform as the stock should be event-driven. Its target price was RM2.01.
The research house said on Wednesday it was high time to relook its potential as a major player in land reclamation. The signing of a sales and purchase agreement for the first phase of the reclamation job at Tanjung Piai should be a major catalyst.
“The stock is a laggard among Iskandar plays and is now our top pick in the smaller-cap space,” it said.
CIMB Research said the valuations were attractive even if it excluded Tanjung Piai’s prospects.
“Its RNAV/share drops from RM2.51 to RM2.35, excluding the latter. At a 20% RNAV discount, the stock should be worth RM1.88 (for 35% upside).
“Optimistically, we estimate a 51% upside to RNAV/share of RM2.51 if we factor in all the potential land sale gains including Pengerang land,” it said.