Trc Synergy Berhad

$TRC / 5054 (TRC SYNERGY BERHAD)
Research Report by TA

$TRC / 5054 (TRC SYNERGY BERHAD)
Research by HLIB
HOLD – TP RM0.47

"Within expectations”

TRC’s 1HFY24 core PATAMI of RM5.5m was within expectations. We had earlier slashed FY24 forecasts by -46%. Net cash per share has dwindled down to RM0.55 from RM0.65. Unbilled orderbook is decent at RM1.0bn. Ara Sentral Ph 2 launch has been delayed to 2Q26 from 1Q25. We have also adjusted downwards FY24 construction replenishment assumptions to RM1.0bn (from RM1.5bn) due to delays in government infra timelines. As such, we change FY25f/26f core PATAMI forecasts by -7.6%/+23.2%. Downgrade to HOLD with lower TP of RM0.47.

Analyst:
Edwin Woo, CFA
ckwoo@hlib.hongleong.com.my

$TRC / 5054 (TRC SYNERGY BERHAD)
Research by TA
Hold – TP RM0.51

“Improving Outlook Ahead"

We left our recent productive meeting with TRC feeling reassured about its near-term outlook. Key takeaways are as follows:- (i) improved earnings visibility backed by a growing orderbook, (ii) a strong candidate for winning mega-infrastructure projects, and (iii) a competitive edge stemming from a healthy balance sheet. We upgrade our recommendation to Hold with a higher TP of RM0.51, based on 11x CY25 EPS.

Analyst:
Raymond Ng Ing Yeow
raymondng@ta.com.my

Change in Audit Committee - TUN JEANNE BINTI ABDULLAH

Change in Risk Committee - TUN JEANNE BINTI ABDULLAH

General Meetings: Outcome of Meeting

Change in Boardroom - DATO' IR ABDULLAH BIN ABD RAHMAN

Change in Audit Committee - DATO' IR ABDULLAH BIN ABD RAHMAN

$TRC / 5054 (TRC SYNERGY BERHAD)

$TRC / 5054 (TRC SYNERGY BERHAD)
Research by TA
Sell – TP RM0.46

“Bags RM125mn Maintenance Job"

We keep our target price unchanged at RM0.46 based on a target PER of 12x against CY25 earnings. Maintain Sell on the stock.

Analyst:
Raymond Ng Ing Yeow
raymondng@ta.com.my

TRC Synergy Bhd has secured a contract worth RM125mil from BHIC Submarine Engineering Services Sdn Bhd to conduct schedule and corrective maintenance work at the Royal Malaysian Navy Submarine Base, Sapangar Bay in Kota Kinabalu.

PETALING JAYA: TRC Synergy Bhd has secured a contract worth RM125mil from BHIC Submarine Engineering Services Sdn Bhd to conduct schedule and corrective maintenance work at the Royal Malaysian Navy Submarine Base, Sapangar Bay, Kota Kinabalu.

OTHERSTRC Synergy Berhad's Subsidiary Secure New Project

Change in Boardroom - ENCIK ABDUL AZIZ BIN MOHAMED

$TRC / 5054 (TRC SYNERGY BERHAD)
Research by HLIB
Buy – TP RM0.60

“Below par start"

TRC’s 1QFY24 core PATAMI of RM147k was below expectations. Negative deviation came from sluggish construction segment. Unbilled orderbook is decent at RM850m (1.8x cover). With infrastructure projects expected to materialise in 2024, TRC could be a beneficiary of this healthier environment. Projects we believe TRC will participate in are LRT, MRT3, remaining KUTS packages, road projects in East Malaysia and airport jobs. Meanwhile its property segment could stay soft until Phase 2 Ara is launched in 1Q25. No change to forecasts. Maintain BUY with unchanged SOP-driven TP of RM0.60. Key appeal remains its traded share price at 32% discount to net cash per share of RM0.65.

Analyst:
Edwin Woo, CFA
ckwoo@hlib.hongleong.com.my

$TRC / 5054 (TRC SYNERGY BERHAD)
Research by TA
Sell – TP RM0.46

“Disappointing Start to the Year"

Following the earnings revision, we reduce our target price to RM0.46 (RM0.52 previously) based on an unchanged target PER of 12x CY25 earnings. Maintain Sell on the stock.

Analyst:
Raymond Ng Ing Yeow
raymondng@ta.com.my

Quarterly rpt on consolidated results for the financial period ended 31/03/2024

$TRC / 5054 (TRC SYNERGY BERHAD)
Research by TA
Sell – TP RM0.52

“New Sub-Contract Job Worth RM142.3mn"

We keep our target price unchanged at RM0.52 based on a target PER of 12x against CY25 earnings. Nevertheless, we are downgrading our call to Sell from Buy previously, as the stock appears to be fairly valued following its recent significant price surge.

Analyst:
Raymond Ng Ing Yeow
raymondng@ta.com.my

KUALA LUMPUR, May 24 (Bernama) – TRC Synergy Bhd wholly-owned subsidiary Trans Resources Corporation Sdn Bhd (TRC) has bagged a RM142.34 million sub-contract for architectural, structural and civil works for the “proposed transformation” of a state legislative building.

© New Straits Times Press (M) Bhd

KUALA LUMPUR: TRC Synergy Bhd wholly-owned subsidiary Trans Resources Corporation Sdn Bhd (TRC) has bagged a RM142.34 million sub-contract for architectural, structural and civil works for the "proposed transformation” of a state legislative building.

TRC - Notice of Book Closure

Share Buy-Back Statement in relation to the Proposed Renewal of Authority for the Company to Purchase Its Own Shares

General Meetings: Notice of Meeting

Annual Report & CG Report - 2023

First and Final Dividend

OTHERSProposed Renewal of Authority for Share Buy-Back

Titan Weekend Chart Reviews

$TRC / 5054 (TRC SYNERGY BERHAD)

Had a good breakout from its RM 0.485+ major resistance levels here with good volume which saw it rally towards the RM 0.53 regions.

For now as long as able to hold above its RM 0.485 support, could continue on this uptrend towards and beyond the RM 0.53+ regions soon.

Support: RM 0.50, RM 0.485 areas
Resistance: RM 0.53, RM 0.55, RM 0.57 areas

CONSTRUCTION
$GAMUDA / 5398 (GAMUDA BERHAD) $SUNCON / 5263 (SUNWAY CONSTRUCTION GROUP BERHAD) $IJM / 3336 (IJM CORPORATION BERHAD) $KIMLUN / 5171 (KIMLUN CORPORATION BERHAD) $TRC / 5054 (TRC SYNERGY BERHAD)
Research by HLIB
Overweight (Maintain)

“Solid start”

1Q24 domestic contract awards totalled RM6.96bn (45% QoQ, -3% YoY). Contracts again were dominated by private sector which saw robust flows notably from commercial & residential projects, while data centre space contributed too. Going forward, we expect contract awards from several big ticket infrastructure projects to drive jobs higher in 2024. We maintain sector OVERWEIGHT keeping to our thesis of contract awards growth driven by mega infra projects & supported by robust private sector job flows. Sector valuations remain undemanding against this positive backdrop. Top picks are Gamuda (BUY: TP: RM6.11) and SunCon (BUY; TP: RM3.20).

Analyst(s):
Edwin Woo, CFA
ckwoo@hlib.hongleong.com.my

$TRC / 5054 (TRC SYNERGY BERHAD)
Research by APEX
Buy – TP of MYR0.67

“Construction Outfit Flying Under the Radar”

Established construction player in the industry, primarily focuses on infrastructure projects, property development, and hotels in Melbourne, Australia. Core earnings is projected to accelerate from billings of current order book and anticipated strong replenishment. Additionally, in FY25F, TRC’s earnings will further boost by the launch of the property segment Ara Sentral Phase 2. TRC is valued by pegging its FY24F core EPS of 4.45 sen to PE of 15.0x, leading to a FV of RM0.67 (44% potential upside from current price).

Analyst(s):
Research Team
research.dept@apexsecurities.com.my

OTHERSValuation of Non-Current Assets