Serba Dinamik's shares up on double-digit earning growth forecast

Serba Dinamik Holdings Bhd's shares thrived during the morning session today on the back of a double-digit earnings growth forecast for the 2017/2018 financial years (FY17/18) At 11.55 am, Serba Dinamik's shares were up two sen to RM2.23, with 3.85 million shares changing hands.

In a research note today, Kenanga Investment Bank Bhd said it expects Serba Dinamik's earnings to grow between 10 and 15 per cent for the FY17/18, following a consistent top-line growth of 15 to 18 per cent.

The forecast was also backed by the gradual recognition of existing projects and 20 per cent success rate from tenders, with a RM2 billion order-book replenishment per annum.

"We believe a significant portion of the revenue is recurring in nature, as maintenance contracts stand a good chance for renewal upon expiry, if Serba Dinamik provides quality services to clients," it said.

The investment bank has set a "outperform" call on Serba Dinamik, with a target price of RM2.75.

Serba Dinamik is primarily involved in the provision of operations and maintenance services in the oil and gas industry, as well as in the engineering, procurement, construction and commissioning (EPCC) in the energy sector. - BERNAMA