NWR Jumps 12% after Acquiring ฿238Mn Skywalk Project, DBSVS Upgrades TP to Bt0.97

The share price of Nawarat Patanakarn Public Company Limited (NWR) rose ฿0.10/share or 12.20% to ฿0.92/share at the closing of the morning session on May 10, 2021, with a trading value of 221 million baht.

 

In the morning, NWR announced that its joint venture company had signed a construction contract with the State Railway of Thailand for the construction of the connected way to connect the skywalk between Chulabhorn Hospital and Lak Si Station with a total contract value of 238,220,000 baht.

 

DBS Vickers Securities (DBSVS) revised up NWR target price to Bt0.97, based on P/BV 2021 at 0.8x or P/E 2021 at 20.4x, expecting the company to report a good net profit in 1Q21. Revenues were forecasted to reach 3.2 billion baht, representing an increase by 33% YoY and 20% QoQ. Meanwhile, gross profit margin would be at 8.3%, compared to 9.2% and 0.2% in YoY and QoQ, respectively.

The SG&A ratio expected to be considerably low at 6% from a high base. The construction and property business would go well, but concrete products might slow down by a bit.

 

NWR has a high construction backlog. At the beginning of the year for construction, there was a 32 billion baht of backlog, which could account for three years, including this year. While about 35% or 11.2 billion baht from the total backlog will be able to recognize this year. The current projects includes the Pink Line MRT Project, the Orange Line MRT Project, the Highway Bridge Project to Pattaya, Klong Bang Luang Flood Prevention Project Phase 3 and the underground walkway project at Sanam Luang.

 

Meanwhile, the company also has a backlog in the real estate sector as well. At the beginning of the year, sales pending transfer for the subsidiary was Mana Development, which the company holds 99% of the shares, is approximately 390 million baht, consisting with two projects: low -rise houses, Baranee Park, Romklao Road, and Aspen Condo Lasalle Phase C in which income and profit items are consolidated.

The joint venture project of Mana Development (40%stake) and CI (60%stake) is Baan Issara Bangna-Trad Km.8, a high-priced housing project. The sales volume is approximately 182 million baht, which will be recognized as profit based on equity.