KUALA LUMPUR: Mitrajaya Holdings Bhd has secured a RM401.88 million construction project from a unit of UEM Sunrise Bhd.

In a filing with the local bourse yesterday, Mitrajaya said its unit Pembinaan Mitrajaya Sdn Bhd has been awarded the project to build the main buildings and external works for two blocks of a condominium in Mont Kiara, Kuala Lumpur.

The group said the contract is expected to be completed by Aug 2, 2017 and is expected to contribute positively to its future earnings.

Earlier in the day, Hong Leong IB Research (HLIB Research) initiated coverage on Mitrajaya with a “buy” rating and target price of RM1.52, saying the group’s order book of RM1.3 billion implied a superior revenue cover of six times.

It said Mitrajaya has RM2 billion in tenders, and another potential contract by year-end, adding that it expects strong take-up for the group’s Wangsa 9 development.

“Earnings to double this year, three-year compound annual growth rate at 40%. Initiate with a ‘buy’, RM1.52 target price (55% upside), our top small-cap construction pick,” it said in a note to its clients.

“At current price, investors are getting its land at 48% discount and all its core business for free,”

This article first appeared in The Edge Financial Daily, on November 6, 2014.