Building up to a super bull run

A super bull run is on the horizon for Malaysian construction stocks next year on optimism that the RM40 billion Mass Rapid Transit project will start in July.

The bullish outlook is also backed by new government initiatives such as the Economic Transformation Programme and the 10th Malaysia Plan, said UOB KayHian head of research Vincent Khoo.

Research houses are maintaining their overweight call on the sector.

"We expect a bull run next year," Khoo told Business Times.

An analyst from TA Research said the stock market needs news like the MRT as a catalyst for construction stocks to sustain its upbeat momentum.

He said judging from the size of the MRT project, it is certain that almost all local construction companies will benefit.

"If the government divides the project evenly, then each company could get contracts worth RM500 million to RM1 billion. This augurs well for the sector," he said.

The MRT, comprising three lines, is the largest infrastructure project in Malaysia's history. The last project announced was the RM12.5 billion double tracks.

Analysts said the first of the three MRT lines, joining Sungai Buloh and Kajang, running through Kuala Lumpur City Centre, is estimated at RM14 billion. The line will cover 60km and have 35 stations.

They said MMC-Gamuda Joint Venture Sdn Bhd may get the tunneling portion from Sungai Buloh to Kajang, worth RM6 billion to RM8 billion.

Master Builders Association Malaysia president Kwan Foh Kwai expects companies like Sunway Construction, IJM Construction, Muhibbah Engineering, Bina Puri, Loh & Loh, MRCB Engineering, UEM Builders, WCT, Ranhill and Ahmad Zaki to bid for the MRT.

Others include Eversendai Corp, Crest Builders, Putra Perdana Construction and MTD ACPI.

Ahmad Zaki managing director Datuk Wan Zakariah Muda said the MRT news is positive for the sector. "There will be spillovers and knock-on effects. We plan to participate in the MRT," he said.

An official from Putra Perdana Construction Sdn Bhd said it will eye packages to build structures, stations, bridges and tunnel lining work.

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15 firms attend SPNB tender briefing for LRT job

STATE-owned public transport operator Syarikat Prasarana Negara Bhd (SPNB) had called for a tender briefing yesterday for the light rail transit (LRT) line extension in the Klang Valley.

It is understood the briefing was attended by 15 construction companies to discuss the scope of works involved in the LRT extension project estimated at about RM9 billion.

SPNB invited the companies.

They include Sunway Construction Sdn Bhd, IJM Construction Sdn Bhd, Muhibbah Engineering Sdn Bhd, Gamuda Bhd, Bina Puri Holdings Bhd, Loh & Loh Corp Bhd, MRCB Engineering Sdn Bhd as well as joint-ventures such as WCT-Sinohydro, Ranhill-CCCC and UEM Builders-Intria Bina.

It is understood that the companies are expected to visit the site this Sunday, where the lines between Ampang and Kelana Jaya are to be built.

"The companies must buy the tender documents for the project by June 24. SPNB may call for tenders for infrastructure works first," a source told Business Times.

It is learnt that there will be a total of eight packages under the project, which will be tendered in stages.

These include the construction and completion of facilities work for the Ampang LRT line, and the Kelana Jaya LRT line.

The other packages are to nominate sub-contractors for fabrication and delivery of segmental box girders for both the Ampang and Kelana Jaya LRT lines.

SPNB group managing director Datuk Idrose Mohamed had recently said that 15 candidates were shortlisted for the sub-contracting of fabrication and delivery of segmental box girder works.

SPNB is raising RM4 billion from bond sales to part-finance the project, which forms part of the RM10 billion railway scheme to expand Kuala Lumpur's public transport network.

Source ...

SunCon, WCT, Fajar, Muhibbbah pre-qualified as main contractors for LRT extensions

Written by Joseph Chin Wednesday, 28 April 2010 11:35

KUALA LUMPUR: Syarikat Prasarana Negara says 17 applicants have been pre-qualified as main contractors for the extensions to the light rail transits for the Ampang and Kelana Jaya lines.

It said on Wednesday, April 28 the applicants have demonstrated their technical and financial capacity and capability with the relevant infrastructure works experience.

They are:
1.Sunway CONSTRUCTION [] Sdn Bhd
2.Fajarbaru Builder Sdn Bhd – Signatium Construction Sdn Bhd JV
3.WCT – Sinohydro JV
4.IJM Construction Sdn Bhd
5.Ranhill – CCCC JV
6.Muhibbah Engineering Sdn Bhd
7.Gamuda Berhad
8.UEM BUILDERS BHD [] – Intria Bina Sdn Bhd JV
9.MMC- Zelan JV
10.MRCB Engineering Sdn. Bhd
11.Trans Resources Corporation Sdn Bhd
12.BPHB – Tim Sekata JV
13.Zabima – Leighton JV
14.Mudajaya Corporation Berhad
15.MTDC – Persys JV
16.Loh & Loh Constructions Sdn Bhd
17.Ahmad Zaki Sdn Bhd

In addition, 15 applicants have been pre-qualified as nominated sub-contractors for the fabrication and delivery of segmental box girder. The successful contractors will be notified officially in due course by Prasarana. The 15 are:

1.Sunway Construction Sdn Bhd
2.Fajarbaru Builder Sdn Bhd – Signatium Construction Sdn Bhd JV
3.WCT – Sinohydro JV
4.IJM Construction Sdn Bhd
5.Ranhill – CCCC JV
6.Muhibbah Engineering Sdn Bhd
7.UEM Builders Bhd – Intria Bina Sdn Bhd JV
8.MMC- Zelan JV
9.MRCB Engineering Sdn. Bhd
10.BPHB – Tim Sekata JV
11.Zabima – Leighton JV
12.MTDC – Persys JV
13.Ahmad Zaki Sdn Bhd
14.Bina Puri – Acre Works – SNC Lavalin JV
15.UEM Construction Sdn Bhd – Projek Penyelenggaraan Lebuhraya Berhad (PROPEL) JV

The financing of the project will be from Islamic bonds guaranteed by the Government. In September 2009, Prasarana had successfully launched RM4.0 billion Sukuk programme of which RM2.0 billion had been raised and oversubscribed by 5.3 times for the 15-year and 2.7 times for the 20-year tranche to part finance the line extension project. The balance of RM2.0 billion will be raised as the project implementation progresses.