not vested
Trading Buy: TALIWRK - 8521
(Last price: RM0.795, Potential upside +27.0%)
Company Profile
• Taliworks is involved in water and waste-related businesses. It has expanded its core expertise to include highway management and construction & engineering.
Trading Catalyst
• Negatives largely priced after a 28% slump in share prices YTD, mainly attributable to the Selangor water crisis, post GE14 selloff coupled with concern of potential cuts in dividend payment and tolls restructuring.
• Nevertheless, further downside risks are cushioned by an undemanding 11.7x FY19 P/E (35% below 10Y average 18x and supported by a 22% EPS CAGR from FY18-20) coupled with a huge trade receivables of ~RM638m or 52sen/share (66% of its market cap).
• Imminent descending triangle breakout with medium to LT upside targets at RM0.90-1.01.
Technical View
• Resistance: RM0.840 / RM0.900 / RM1.01
• Support: RM0.760 / RM0.740
• Cut loss: RM0.695
Key Financial Stats
• Trading at 11.7x FY19E (35% below 10Y average 18x)
• 0.92x P/B (29% below 10Y average 1.3x)
Source: HLIB