This article first appeared in The Edge Financial Daily on May 7, 2019 - May 13, 2019

Vizione Holdings Bhd
(May 6, RM1.03)
Buy with a higher target price (TP) of RM1.20. Vizione Holdings Bhd posted another quarter of solid financial results amid the challenging market conditions within the construction sector. We believe the company’s growth trajectory remains intact. The TP of RM1.20 is based on 9.6 times price-earnings ratio (PER) for financial year 2020 (FY20) as per the closest related peers.

To recap, Vizione has 20 years of successful fast-track delivery, having completed 50 private and government projects worth RM1.9 billion to date. It has also secured the RM407.5 million Penang Mega Infrastructure Project (package 2) which is deemed to be a stepping stone to secure the remaining packages with a total estimated value of RM6.3 billion. Vizione has an outstanding order book of about RM2.9 billion, which will keep them busy until 2020.

Additionally, the group recently moved into the property segment by acquiring Pembinaan Angkasa Permai Sdn Bhd, a joint developer of an apartment project called 216 Residences with a gross development value of about RM111.3 million. The latest property venture will set a better footing for Vizione to complement its construction division.

Vizione’s balance sheet remains healthy with a gearing of 0.05 times which should provide ample room for expansion, especially in the concession business. While its profit growth is on track, we expect better job flow going forward on the back of the improving construction sector. — Rakuten Trade Research, May 6.