Serba Dinamik up after announcing first batch of contract wins for 2020

KUALA LUMPUR (Feb 5): Serba Dinamik Holdings Bhd's share price rose as much as 10 sen or 4.5% to RM2.32 in morning trades today after the energy support services group announced its first batch of contract wins for 2020 comprising local and overseas projects.

Yesterday, Serba Dinamik said in its Bursa Malaysia filing that the six overseas contracts, comprising projects in Indonesia and Oman have a combined estimated value of US$78 million (RM320.89 million).

Serba Dinamik also secured six contracts in Malaysia. Serba Dinamik said these contracts have no specific value as the projects are on a call-out basis whereby the work orders will be awarded at the discretion of the client based on their activities’ schedules and rates throughout the duration of the respective contracts.

Today, Affin Hwang Investment Bank Bhd analyst Tan Jianyuan wrote in a note that Serba Dinamik's six Malaysian jobs are valued at around RM620 million.

Tan said the overseas and Malaysian projects bring Serba Dinamik's contract wins so far this year to RM940 million and its latest orderbook to
RM10.7 billion.

"Management’s internal target stands at RM15 billion by end-2020. We make no changes to our earnings forecasts as these contracts fall under our replenishment target for the year.

"We reaffirm our buy rating (for Serba Dinamik shares) and keep our 12-month target price unchanged at RM2.62, based on a 2020E PER (price-earnings ratio) of 14 times," the analyst said.

At Bursa today, Serba Dinamik shares were traded at RM2.30 at 9:46am for a market capitalisation of RM6.85 billion. Serba Dinamik saw some three million  shares transacted.