KSH Holdings: Wins S$138.4m Eight Courtyards building contract (DMG)

The news: KSH secured the S$138.4m Eight Courtyards construction project by Yishun Gold Pte Ltd, a joint venture company between Frasers Centrepoint and Far East Organisation. Eight Courtyards is a 99-years leasehold condominium development in Canberra Drive. The project is slated to commence in Dec 2011 for a duration of twenty-nine months.

Our thoughts: We note that KSH has previously worked with both Frasers Centrepoint and Far East Organisation on prior projects and hence look upon the winning of this contract as a testament to KSH’s ability to generate repeat orders from its clients with its well-established track record. Apart from boosting KSH’s track record in residential property construction, this contract will also beef up its order books to S$360m, to be fulfilled by May 2014. With sustained growth in construction demand that is backed by the major infrastructure projects such as the MRT Downtown Line Stage 3 and good take-up rates in prior residential property launches, we maintain our BUY recommendation with a TP of S$0.31.