Based on the forecast from some research and JAKS share price of RM1.12, JAKS will be trading at PE Ratio of about 5.5x which is quite attractive and also with their recurring income. Normally not paying dividend currently.
The Start Tuesday, 22 September 2015.
KUALA LUMPUR: Jaks Resources Bhd has signed a US$1.4bil financial deal between its China-based joint-venture partner, as part of its US$1.87bil coal-fired thermal power plant project in Vietnam.
In a statement on Tuesday, Jaks said the agreement was made between China Power Engineering Consulting Group Co Ltd and its principal financiers which are the Industrial and Commercial Bank of China, China Construction Bank Corporation and Export-Import Bank of China
It said that the project will be funded on an intended capital structure of about 75% debt and 25% equity.
In its EGM, Jaks received approval from shareholders to proceed with the proposed 50:50 joint venture agreement between Jaks Power Holding Limited and China Power to invest in the project in Vietnam.
Jaks chief executive officer Andy Ang Lam Poah said with the passing of shareholders’ resolution and signing of loan agreements, the group will be able to formalise financial close for the project before the end of October 2015.
“We are also delighted to see the support from our financiers which certainly underscores the bankability of the project in Vietnam.”
He said with their financial strength and proven expertise in the power industry, Jaks is confident of the timely completion of the power plant by year 2020, Ang added.
Engineering, procurement and construction (EPC) contract 1 for the Vietnam power plant, valued at US$1.06bil was awarded to a China Power-led Consortium, whilst Jaks unit Golden Keen Holdings Limited was awarded EPC Contract 2 worth US$454.5mil for its civil and M&E engineering works.
With this EPC contract in hand, Jaks' construction orderbook has tripled to RM2.52bil.
Jaks is also primed to enjoy recurring income from power generation when the plant commences commercial operation in 2020.