DJ MARKET TALK: Eversendai May Rise 15%-20% On Main Market Debut

Construction firm Eversendai Corp (5205.KU) may rise 15%-20% on its main market debut from its IPO price of MYR1.70. "There will be demand for this stock as it got decent subscription," a local dealer says. The company offered 232.2 million shares in the IPO and raised MYR392.3 million; the institutional offering was more than 2.5X oversubscribed and the retail offering was 7.3X oversubscribed. RHB Research says the company is mainly present in Middle East, Malaysia and India, and its outstanding construction orderbook stood at MYR1.4 billion as at May 16. "We project Eversendai's EPS to grow by 15.1% and 12% in FY11-FY13," under the assumption that it will secure MYR1.4 billion, MYR1.5 billion and MYR1.6 billion worth of new contracts for each year respectively. The house has a fair value of MYR2.27 on the stock.