Higher Profits For Permaju With RM1.2 Billion Contract Win | Hey guys! Growth in terms of revenue and net profit is expected for Permaju Industries Bhd with its latest contract win, to build more than 7,000 units of apartments over six to seven years in Selangor. It was reported in an English daily today that Permaju has won a construction contract worth about RM1.2 billion to undertake a massive property development project on a big plot of land in the Seri Kembangan/Serdang area.
The contract was awarded by a reputable developer. No name was given regarding the developer. It mentioned that the tallest tower in the development is said to be over 50 floors which would also make it the tallest structure in the Seri Kembangan/Serdang area. Permaju will undertake the contract on a design and build structure and the whole project will generate about RM2.4 billion in gross development value.
If you do the math, Permaju is surely going to generate a huge profit from this development in the seven year period along with other projects or contracts that it has in hand. On April 7, Permaju said it is looking into bottling and distributing Penaclo, a Hong Kong firm’s sanitiser product, for the Southeast Asian market amid the Covid-19 pandemic. About three weeks later Permaju inked a memorandum of understanding with a local firm to sell the company's air purification products to its customers in the automotive sector, citing exponential demand growth for the product.
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| Higher Profits For Permaju With RM1.2 Billion Contract Win |
Last month Permaju told Bursa Malaysia that it has incorporated a company named Permaju Glove Sdn Bhd (PGSB) to venture into the glove manufacturing business. The intended principal activity of PGSB is to manufacture, distribute, buy, sell and generally deal in rubber goods for industrial and commercial purposes and other related goods, wares and merchandise of every nature and description, it said. No wonder the stock has been trading actively in recent weeks or months.
The stock's 52-week low was 24 sen while its 52-week high was RM1.07. In fact the stock traded above RM1.00 just a few months ago but dropped drastically to below 30 sen because of market weakness and the Covid-19 pandemic. Permaju was not the only counter that fell during this period. I believe more than 80 per cent of the counters, including the shares of property developers and construction firms fell to levels unseen before.
Permaju rose to 34 sen today but closed lower at 30 sen, giving the company a market capitalisation of RM58.78 million. I think there is great potential for the stock to rise up again and it could trade higher tomorrow.
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