United EnviroTech: Could see some positive sentiments, after grp annouced that it has secured a contract involving the acquiring, upgrading and operating of a 80,000m3/day wastewater treatment plant and a 40,000m3/day wastewater recycling plant at Tangshan, Hebei Province for Rmb280m (approx $55m). Project will be completed by end of 31Dec11 and positively impact FY2012 Performance….
We note that contract win brings grp’s orderbook to approximately S$155m, underpinning earnings visibility till 2012. Meanwhile, China has recently announced that it plans to double its investment in water conservation projects to RMB4tr(S$775.1b) over the next 10 yrs and has made water conservancy a priority…..
We note that at current price, valuations appears compelling, with grp trading at 9.78x Forward PE, vs historical average of 14.5x and peer’s Sound Global 16.5x and Hyflux of 23.4x. OCBC has Buy Call for stock with $0.65 TP.
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