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2016 A Lift-Off Year For Malaysian Resources Corporation: AmResearch
Malaysia Daily Bulletin | 09 November 2015
By:
  • AmResearch noted that Malaysian Resources Corporation (MRCB) is approaching the tail-end of its restructuring moves to optimise its corporate structure, balance sheet and growth trajectory, and expects 2016 to be a year where the firm would be moving from restructuring to growth.
  • The group is said to be leveraging on the success of KL Sentral to elevate itself as the premier transport-oriented developer. The use of railway accessibility and connectivity in urbanised areas to drive end-user demand is a key differentiating factor for MRCB.
  • The company has consciously taken concrete steps to strengthen its construction division – a major earnings drag in the past – with a newfound focus on infrastructure works and more importantly fee income from several contracts inked.

Significance: With positive expectations on MRCB in 2016, the research house has reaffirmed its ‘Buy’ rating on the stock and has raised its fair value from RM1.65 per share to RM2.12 per share. While net gearing is projected to rise to 1.6 times, it is not a point for much concern, as capital locked-up in investment properties could be recycled into the group’s real estate investment trust.


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