KUALA LUMPUR (Feb 4): Muhibbah Engineering (M) Bhd clinched a US$32 million (RM116 million) construction subcontract for the Petroliam Nasional Bhd's (Petronas) Refinery and Petrochemicals Integrated Development (Rapid) project in Pengerang, Johor.

In a statement to the exchange today, Muhibbah (fundamental: 1.15; valuation: 0.6) said it clinched the contract from Petronas contractor Tecnicas Reunidas S.A. Group.

Muhibbah said it was appointed by Tecnicas Reunidas to design and build "temporary construction facilities and accommodation camp". The subcontract comes under package 3 of the Rapid project.

According to Muhibbah, Petronas has awarded Tecnicas Reunidas, the Rapid package 3 contract which involves construction of oil and gas downstream facilities. The list includes kerosene, diesel and naphtha hydrotreating units for Petronas.

Muhibbah's subcontract package is expected to take one year to complete.

"The construction is scheduled to commence in first quarter of 2015 and is expected to be completed by first quarter 2016.

"The contract is expected to contribute positively to the earnings and net assets of Muhibbah group for the current and future financial years," Muhibbah said.

Muhibbah shares rose seven sen or 3.7% as at 12:30pm to settle at RM1.97 for a market capitalisation of RM850.5 million.

The stock had risen 5% this year, outperforming the FBM KLCI's 2% gain.
 
(Note: The Edge Research's fundamental score reflects a company’s profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)