KUALA LUMPUR: There could be more contract wins to be announced by Serba Dinamik Holdings Bhd before the close of the year, driven by current tenderbook of roughly RM11 billion.
Kenanga Research said Serba Dinamik had targeted to achieve an orderbook of around RM7.5 billion by the year-end, just RM300 million short.
“There is no change to earnings as it is still within our replenishment of RM3 billion, while we also expect further contract wins before year-end,” the firm said in a note.
Serba Dinamik announced on Thursday a total of 13 new operations and maintenance contracts awarded, four of which are in the Middle East with a combined value of RM512.17 million.
Kenanga Research was positive on the news as the contract wins bring Serba Dinamik’s year-to-date new wins to RM2.2 billion and orderbook to RM7.2 billion.
“The 13 contract wins by Serba Dinamik not only signifies the oil and gas company’s strong footing in the Middle east but also demonstrates its competitiveness in the local scene,” it said.
The rest are local contracts with undisclosed value as they are on call-out basis but Kenanga Research estimates it to be around RM100 million.
Kenanga maintains an “outperform” call on Serba Dinamik with a target price of RM4.45.
“We continue to like Serba Dinamik, with it being our top pick within the oil and gas sector, given its consistent and commendable track record of earnings growth delivery,” it said.
Others include Serba Dinamik’s dynamic expansions into new markets through inorganic growth and superior return on equity among its peers – 22 per cent versus sector average of eight per cent.