KUALA LUMPUR: CIMB Research said Mudajaya's annualised 1H11 core net profit was a letdown, coming in at 71% of its full-year forecast and 77% of consensus.
It said on Wednesday, Aug 24 it had underestimated the impact of delays in EP works for the independent power project in India.
For the first half, Mudajaya's net profit was 3.1% lower at RM101.54 million compared with RM104.82 million while at the pre-tax level, it slipped 13% to RM131.07 million from RM150.72 million.'' Its revenue increased 29.3% to RM579.19 million from RM447.98 million.
'Although 2Q11's profits were much improved on-quarter and 2H will be stronger than 1H, we reduce our FY11-13 EPS forecasts by 2-7% to reflect the hold-ups.
'This lowers our RNAV by 7.3% from RM7.44 to RM6.88, taking our target price down from RM5.95 to RM5.50, pegged to 20% RNAV discount,' it said.
CIMB Research said despite the cut in forecasts, it continued to rate Mudajaya a BUY as the stock could be re-rated by contract awards. It also said the CY11-12 price-to-earnings were only 5.0 times to 6.0 times.
It said on Wednesday, Aug 24 it had underestimated the impact of delays in EP works for the independent power project in India.
For the first half, Mudajaya's net profit was 3.1% lower at RM101.54 million compared with RM104.82 million while at the pre-tax level, it slipped 13% to RM131.07 million from RM150.72 million.'' Its revenue increased 29.3% to RM579.19 million from RM447.98 million.
'Although 2Q11's profits were much improved on-quarter and 2H will be stronger than 1H, we reduce our FY11-13 EPS forecasts by 2-7% to reflect the hold-ups.
'This lowers our RNAV by 7.3% from RM7.44 to RM6.88, taking our target price down from RM5.95 to RM5.50, pegged to 20% RNAV discount,' it said.
CIMB Research said despite the cut in forecasts, it continued to rate Mudajaya a BUY as the stock could be re-rated by contract awards. It also said the CY11-12 price-to-earnings were only 5.0 times to 6.0 times.
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