KUALA LUMPUR (May 17): Hong Leong Investment Bank (HLIB) Research said the anticipated rebound in construction activities, particularly in railway projects, is expected to generate more contract opportunities for companies like Econpile Holdings Bhd (KL:ECONBHD).
In a technical tracker note on Friday, the research house, which has a “trading buy” rating on Econpile, said construction activities are poised for sustained growth in 2024, with the Ministry of Finance forecasting a 6.8% year-on-year increase in gross domestic product from construction, up from 6.3% in 2023.
It said that supporting this, development expenditure is targeted at a record high of RM90 billion, compared to RM83.4 billion in 2023 (excluding 1Malaysia Development Bhd bond repayment).
“The anticipated rebound, particularly in railway projects, is expected to generate more contract opportunities for companies like Econpile.
“Market expectations are high for Econpile’s involvement in several projects including MRT3, KL-SG HSR, and the SKL project, with the collective piling contract size estimated to exceed RM5 billion (versus order book of circa RM480 million as of March 2024).
“Econpile is building a base at 45 sen-48 sen region alongside with on the mend indicators.
“A successful breakout above 51 sen will spur the price towards 54 sen-56 sen-59 sen region. Cut loss at 44 sen,” it said.
Looking to buy a home? Sign up for EdgeProp START and get exclusive rewards and vouchers for ANY home purchase in Malaysia (primary or subsale)!
Source: EdgeProp.my
POST YOUR COMMENTS