PTT Synergy shares soar to over two-decade high on contract news

TheEdge Tue, May 14, 2024 09:31am - 1 month View Original

KUALA LUMPUR (May 14): Shares in PTT Synergy Group Bhd (KL:PTT) soared on Tuesday to their highest in nearly 24 years, as news of two construction contracts worth RM169.85 million attracted the attention of investors.

PTT climbed as much as 25.5% or 40 sen to RM1.97, its highest since July 2000. The stock then pared its gains to close at RM1.88 — still up 31 sen or 19.75% — valuing the company at RM344.29 million. The counter had risen 27.6% on Monday, ahead of the contract announcement.

At over 3.28 million shares, the trading volume on Tuesday was also more than 16 times the 50-day moving average, and 34 times the 200-day moving average.

No institutional analysts cover the stock.

PTT’s share price has risen over 54% year-to-date, and 80% in the past year, tracking a broad rally in the construction and property sectors.

PTT said one of the contract valued at RM96.61 million covers the construction and completion of earthworks and ancillary works for Stage 1 at Lagong Mas in Gombak, Selangor, while the other contract worth RM73.24 million involves earthworks and ancillary works for the development of Stage 3 at Bandar Bukit Raja, Klang.

PTT is 55.02% controlled by its executive chairman Datuk Abd Rahim Jaafar, deputy chairman Teo Swee Leng and managing director Teo Swee Phin, through their private vehicle Aim Tetap Teguh Group Sdn Bhd. 

In March, PTT secured a RM299 million contract to build the Palekbang-Kota Bharu bridge and connecting roads at Jajahan Tumpat and Jajahan Kota Bharu in Kelantan. The company secured the project from Prima Wahyu Sdn Bhd, a construction company that is 67%-owned by Noruzzaman Che Idris and 33%-owned by Wan Afandi Wan Ahmed. 

PTT’s net profit dropped 84.6% to RM807,000 for the second quarter ended Dec 31, 2023 (2QFY2024) from RM5.23 million a year earlier, due to higher finance costs, despite quarterly revenue having jumped 45% year-on-year to RM86.93 million, contributed by its construction and investment services segments. 

Net profit for the first six months ended Dec 31, 2023 (1HFY2024) totalled RM4.16 million — down 30.3% year-on-year from RM5.97 million — on the back of RM154.8 million in revenue.

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