Common Contracts

Contract

July 2nd, 2020

• Filed
  July 2nd, 2020

Gamuda (GAM MK)PDP agreement inked Orderbook support beyond FY21After several delays, Gamuda’s consortium has finally inked the Master Agreement with the Penang State Government appointing the former as Project Delivery Partner (PDP) to implement the Penang Transport Master Plan (PTMP). While the PDP fee of 5.0-5.75% looks fair, it ultimately depends on the risks for the PDP’s scope. Gamuda’s direct involvement in the construction related works will support its orderbook beyond FY21. We maintain our earnings forecasts and RNAV-TP (MYR3.80) for now. PDP agreement finally inkedGamuda will hold a 60% stake in the consortium (not new). The PDP scope comprises: (i) reclamation of three islands (A, B and C) of the PTMP’s Penang South Reclamation (PSR) component, and subsequent marketing/tender/sale of land there, (ii) a rail transit of approximately 23.5km, and (iii) two highways of 19.5km and 5km each (the latter will connect to Island A of the PSR). Gamuda’s announcement on Bursa says tha