UEM Edgenta

[winston]

not vested

On stock selection, Edgenta’s (BUY-HLIB Research TP RM2.63) risk-reward profile is increasingly attractive after sliding 27% to RM1.98 from a 3M high of RM2.73, supported by positive newsflow that it has entered into contracts (RM264m-RM284m) for the provision of hospital support services to Ministry of Health of Singapore’s (MOHS) restructured hospitals.

Current valuation is undemanding at 10.8x FY21 P/E (-30% vs 5Y mean), supported by an attractive 6.4% FY21E DY and robusrt RM13.4bn work in hand. T

echnically, the stock is likely to trap in sideways consolidation mode unless the upper BB at RM2.10 is taken out decisively. Further upside targets are RM2.23-2.33.

Key supports are near RM1.83-1.96. Cut loss at RM1.82.

Source: HLIB