This article first appeared in The Edge Financial Daily, on January 13, 2016.
Kimlun Corporation Berhad (+ve)
KIMLUN (Fundamental: 1.7/3, Valuation: 2.4/3) rose 6.6% to a one-year high of RM1.61 on heavy volume yesterday.
Johor-based Kimlun, a well-established building contractor and concrete products supplier, is seen as a cheaper proxy to major infrastructure projects in Iskandar Malaysia as well as Mass Rapid Transit (MRT) developments in Malaysia and Singapore.
For 9M2015, revenue declined 12% y-o-y to RM821.7 million on lower construction and property development revenue. Net profit, however, surged 39% to RM49.3 million, boosted by better margin projects, lower raw material and fuel costs, and favourable sales mix.
Current outstanding orderbook level is relatively thin at RM1.14 billion — just 0.98 times its 2014 construction and manufacturing revenue. Unbilled property sales stood at RM41 million, down from RM118 million a year ago.
The stock trades at a trailing P/E of 7.8 times and 1.04 times book value. Dividend for 2014 was 3.8 sen, giving a yield of 2.5%.