Hyflux

Hyflux: Surged 6.1% today, after the group was awarded a $250m design, build, own and operate water project from government-owned, Oman Power and Water Procurement Company SAOC (OPWP). The 200,000 cubic metres per day water project which will be located in Qurayyat is something familiar to Hyflux- a seawater reverse osmosis desalination plant, similar to the one it completed in Singapore in 2013. The project is scheduled to commence commercial operation by May 2017 under a 20-year water purchase agreement with OPWP. This follows a dearth of new contracts and a depleting order book which the company has been facing, prompting dull sentiments by the street. Overall, market watchers are not optimistic on Hyflux due to its diminishing profitability margins and slower new order momentum, attributed to the weak growth in global municipal water projects. Bloomberg consensus has 0 Buys, 5 Hold and 3 Sell ratings on the counter with a 12-month TP of $1.12.