HSL ... Oct12

Sarawak based construction company HSL is expected to benefit from public infra projects in the state as the government ramps ip spending on rural development as planned under Budget 2013.

Widely seen as a proxy for the Sarawak construction sector, HSL, with its expertise in dredging and land reclamation, is expected to secure projects under the government’s rural transformation programme. Under Budget 2013, PM Datuk Seri Najib said the government had earmarked rm4.5 billion to finance various rural infra development projects.

These include the construction of roads as well as water and electricity generation related infra jobs.

HSL’s order book stood at rm1.9 billion of which rm1.1 billion remains outstanding.

It will continue to bid for projects in Sarawak especially within the SCORE where the company expects more infra contracts to be rolled out as foreign investors set up their manufacturing operations there.

Energy intensive industries within SCORE will be the main growth driver for the corridor, where the Samalaju Industrial Park is located.

Debt free HSL had a cash pile of rm195 million as at June 2012 while net assets per share stood at 79 sen.

Its valuation is supported by its net cash per share of 40 sen and revised net asset value of its 890 acre landbank of 65 sen per share.

HSL and KBB Engineering Bhd are leading Sarawak based construction entitles that are expected to benefit from the budget allocation of rm4.5 billion for rural infra development projects.

Both companies have clinched water supply projects in the Samalaju Industrial Park, SCORE and rural enclave.