MBKET Upgrades SQ’s Target Price to Bt3.30 on Higher Backlog and Futureproof Earnings
Maybank Kim Eng (Thailand) revised up SQ's target price to Bt3.30, seeing more than 27 billion baht of backlog after the acquisition of HPC's projects.
Maybank Kim Eng (Thailand) revised up SQ's target price to Bt3.30, seeing more than 27 billion baht of backlog after the acquisition of HPC's projects.
23 มิ.ย. 2564

The share price of Sahakol Equipment Public Company Limited (SQ) rose as much as ฿0.24/share or 8.05% to ฿3.22/share, but close flat at ฿2.98/share in the morning session on June 22, 2021, a day after the acquisition of 4,587 million baht project from Hongsa Power Company Limited (HPC).
 
Yesterday, the company made an official announcement to the Stock Exchange of Thailand (SET) that the company received letter of Award from Hongsa Power Company Limited (HPC) to Build, Lease and Transfer (BLT) with a privilege to perform O&amp;M Services for the Waste Line 2 Conveyor Expansion Project that the amount of a services fee approximately 4,587 million baht for a total of two contracts.
Contract 1: Build, Lease and Transfer (BLT) project, to construct the conveyor system, the amount of a service fee approximately 2,245 million baht, work period in 13 years.
Contract 2: O&amp;M Services for the Waste Line 2 Conveyor Expansion project, scope of works are the operation and maintenance services of the conveyor system (from the Contract I), the amount of a services fee approximately 2,342 million Thai Baht, work period in 7 years (January 2027 – December 2033).
 
The announcement resulted in a surge in SQ’s share price by 11.19% and closed the yesterday’s session at ฿2.98/share.
 
Maybank Kim Eng has given a “Trading Buy” on SQ as the backlog rose to 27 billion baht after the project acquisition from HPC, which would be recognized gradually in 2024-2027. As for the North Pit Wall project worth 830 million baht, the revenue recognition will start next year.
Maybank maintained revenue and earnings estimates this year, but upgraded next year’s estimate slightly as well as revised the target price up from Bt3.00 to Bt3.30 per share.
 