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Kelington ends maiden trading with 10.5 sen gain
Written by Joy Lee
Thursday, 26 November 2009 11:12
KUALA LUMPUR: Kelington Group Bhd (KGB) closed at 63.5 sen, a 20% or 10.5 sen rise over its issue price of 53 sen, on its ACE Market debut yesterday.
KGB made a strong debut, opening at 73 sen, 20 sen above its issue price. The counter hit an intra-day high of 90 sen and was traded at a low of 61 sen.
The UHP gas and chemical delivery systems provider yesterday also announced its winning a RM5 million contract for a wafer fabrication facility in Dalian, China.
“We are heartened to be awarded the first phase of the hook-up project for UHP water and chemical delivery systems in the largest wafer fabrication facility in the world in Dalian, China which is slated to commence operations in 2010.
“This letter of award undoubtedly raises our profile and cements Kelington’s reputation as a leading provider in the UHP sector in a big way,” chairman and chief executive officer Raymond Gan said in a statement yesterday.
Gan added the group was looking to expand into other UHP utilities, such as ultrapure water and hi-vacuum systems.
The group’s net profit for the third quarter ended Sept 30, 2009 jumped 218.5% to RM3.01 million from RM945,000 a year earlier while revenue rose 76% to RM19 million from RM10.78 million due to the increased number of contracts secured by its Malaysian operations as well as revenue contribution from Singapore.
It posted a RM6.42 million net profit on the back of RM44.67 million revenue for the cumulative nine months, an increase of 48% and 1.5% respectively.
In a recent research note, OSK Research expected Kelington’s revenue to grow organically by 5.4% and 2.7% for FY09 and FY10 respectively boosted by strong order book of RM74.98 million.
“Given its strong order book, net cash and partnerships with industry leaders, we believe the company should be able to attain our small cap coverage price-earnings ratio (PER) of eight times.
“Applying a small cap average PE of eight times over FY10 earnings per share, we derive a fair value of 85 sen with an upside potential of 60.4% from its issue price of 53 sen,” it said.
This article appeared in The Edge Financial Daily, November 26, 2009.
