Moya Holdings Asia - RHB Invest 2020-03-02: Targeting Growth From All Angles

MOYA HOLDINGS ASIA LIMITED (SGX:5WE) | SGinvestors.io MOYA HOLDINGS ASIA LIMITED (SGX:5WE)

Moya Holdings Asia - Targeting Growth From All Angles

  • Moya Holdings Asia (SGX:5WE) reported a decent FY19, with EBITA increasing 18% y-o-y to SGD82.2m.
  • Going forward, management expects to target growth from all angles, organic and inorganic. With the future plans, we expect higher capex and increased finance costs, especially with the acquisition of the Obor Group.
  • We reduce our FY20-21F PATMI by 3-4% respectively, reducing our DCF-backed Target Price to SGD0.082. However, we remain confident of Moya’s growth plans and maintain BUY.



Focus on inorganic and organic growth.

  • Management is focusing on organic growth of PT Moya Tangerang, which is constructing its new 1,000 litres per second (lps) water treatment plant (completion target: 2H20), and PT Aetra Air Tangerang, which is currently uprating water treatment plant capacity from 900 lps to 1,200 lps. PT Aetra Air Jakarta is in discussions with PAM Jaya on future development plans for the existing Jakarta cooperation scheme.
  • Besides organic growth, management is also looking for opportunities to further expand its business via participation in new tenders, either business-to-business or public-to-private partnership, as well as M&A to deliver greater value to the shareholders and enhance profitability.


Synergistic acquisition.

  • The Obor Group is in the business of developing and operating water treatment facilities as well as supplying bulk water to municipal water companies in Banten Province, Indonesia, similar to Moya.
  • The acquisition would allow Moya to expand its production capacity and customer reach. It also allows the company to integrate their operations and supply chains, as well as achieve greater economies of scale, which would improve the efficiency and profitability of the combined entity.


Maintain BUY.






Jarick Seet RHB Securities Research | https://www.rhbinvest.com.sg/ 2020-03-02
SGX Stock Analyst Report BUY MAINTAIN BUY 0.082 DOWN 0.093



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