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Pintaras Jaya incurred a loss in 2023 but this is due to a “perfect storm” of lower revenue and higher costs. Its performance in Malaysia over the past few years was affected by the slowdown in the property and construction sector. As such the bulk of the contribution over the past few years has been from its Singapore operations. https://i.postimg.cc/DzJd8mDL/Pintaras-valuation.png
As the leading foundation and sub-structure contractor in Malaysia, I expect the
Group to rebuild the Malaysian business. When this happens, I expect the market to re-rate it.
Aneka and Econpile are getting good construction orders. With the Malaysian piling industry picking up, this will also benefit both Singapore and Pintaras as more projects to soak up capacity
Penang LRT, MRT, HSR, Johor property market getting vibrant due to RTS and spillover effect from land scarced Singapore, recovering property market in Malaysia, incoming new projects in Singapore, data centre and industrial projects boom. These are the upside factors to Pintaras. At what risk? RM 100 million ++ net cash, good management with ability to navigate contruction cycles, great track record in piling, with unbroken profitability record. Low margins wont last forever, this is the bottom. It can go up to RM 2, no sweat.
You cannot lump Ptaras with the rest of property and construction stocks. Ptaras has its own factors that is driving the increase in its share. It is dirt cheap, commodity prices increase that hurt Ptaras profits is subsiding, great management, and above all, it is simply oversold since the commodity prices shock. Whether the property/construction industry is going to boom, is another issue. And yes, if these external factors become positive, Ptaras will also benefit immensely. This is the reaso
Why bet on Pintaras? Because it is a risk free bet. Why risk free bet? Because construction projects are coming and Pintaras has the strongest balance sheet to tide through good and bad times. If construction turns out to be dissapointing, we dont lose money, if the opposite happens, we make a bang. Why wont we lose money? Pintaras is showing losses in recent quarters, but these are caused by the Malaysian operations. Its SG operations, which is the main business, is still fairly profitable. It is also has a big cash pile and good dividend track record.
