NAIM
Posted: Mon Apr 22, 2019 8:53 am
not vested
Trading Buy: NAIM - 5073
(Last price: RM1.07, Potential upside +19.6%)
Company Profile
NAIM (listed in Sep 2003) is a fully-integrated property and construction player focusing on integrated property developments, construction, civil engineering and O&G services (via a 26% stake in Dayang). Naim is also a Class A Contractor, which is one of Malaysia’s largest Bumiputera contractors
Trading Catalyst
NAIM’s share price has rallied by 140% YTD, mirroring the 148% surge of its 26%-owned associate, Dayang. Notwithstanding the recent rally, NAIM’s share price is still undervalued as we opine that investors have yet to fully appreciate the embedded value of its construction and property businesses
Indeed, adjusted for its stake in DAYANG (RM336m market cap), the current implied value of RM214m market cap (Naim’s market cap of RM550m-RM336m) on its core businesses is only 5.4x P/E against its Sarawak’s peers of 9-10x.
Given its robust construction orderrbook of RM1.9bn, positive prospects of Dayang and resilient earnings from its property division (despite the challenging outlook) coupled with the expectations of more pump-priming activities before Sept 2021 state election, market could assign a higher rating on NAIM.
Technically, the stock is poised for a downtrend line breakout above RM1.18 to advance further towards RM1.28 levels.
Technical View
Resistance: RM1.13 / RM1.18 / RM1.28
Support: RM1.03 / RM0.995
Cut loss: RM0.970
Key Financial Stats
Trading at 8.5 FY18 P/E (25% lower than peers) and 0.43x adjusted P/B post 3 for 2 rights issue at RM0.45 (62% below its peers), respectively.
Source: HLIB
Trading Buy: NAIM - 5073
(Last price: RM1.07, Potential upside +19.6%)
Company Profile
NAIM (listed in Sep 2003) is a fully-integrated property and construction player focusing on integrated property developments, construction, civil engineering and O&G services (via a 26% stake in Dayang). Naim is also a Class A Contractor, which is one of Malaysia’s largest Bumiputera contractors
Trading Catalyst
NAIM’s share price has rallied by 140% YTD, mirroring the 148% surge of its 26%-owned associate, Dayang. Notwithstanding the recent rally, NAIM’s share price is still undervalued as we opine that investors have yet to fully appreciate the embedded value of its construction and property businesses
Indeed, adjusted for its stake in DAYANG (RM336m market cap), the current implied value of RM214m market cap (Naim’s market cap of RM550m-RM336m) on its core businesses is only 5.4x P/E against its Sarawak’s peers of 9-10x.
Given its robust construction orderrbook of RM1.9bn, positive prospects of Dayang and resilient earnings from its property division (despite the challenging outlook) coupled with the expectations of more pump-priming activities before Sept 2021 state election, market could assign a higher rating on NAIM.
Technically, the stock is poised for a downtrend line breakout above RM1.18 to advance further towards RM1.28 levels.
Technical View
Resistance: RM1.13 / RM1.18 / RM1.28
Support: RM1.03 / RM0.995
Cut loss: RM0.970
Key Financial Stats
Trading at 8.5 FY18 P/E (25% lower than peers) and 0.43x adjusted P/B post 3 for 2 rights issue at RM0.45 (62% below its peers), respectively.
Source: HLIB