Jun 23, 2010

Malaysia Construction: LRT Extensions - call for tender

malaysia-LRT Syarikat Prasarana Negara calls for tender briefing

According to the Business Times, Syarikat Prasarana Negara Bhd (SPNB) had called for a tender briefing yesterday for the LRT extensions. The briefing was attended by 15`construction companies to discuss the scope of works involved with the project size estimated at RM9bn. The contractors which were invited by SPNB are Sunway, IJM, Muhibbah, Gamuda, Bina Puri, Loh & Loh Corp, MRCB as well as joint-ventures such as WCT-Sinohydro, Ranhill-CCCC and UEM Builders-Intria Bina. The deadline to buy the tender documents is by 24 June 2010 and SPNB may call for tenders for infrastructure works first.

Apparently, there will be a total of eight packages which will be tendered in stages. The other packages are to nominate sub-contractors for fabrication and delivery of segmental box girders for both the Ampang and Kelana Jaya LRT lines. The project size of RM9bn appears larger then the initial estimate of RM7-8bn but there is no clear breakdown on what the infrastructure portion will be.

This news is not significantly different from what was reported in late April 2010 but names which appeared to be left out this time round are MMC-Zelan, Fajarbaru Builders- Signatium Construction, Trans Resources, BPHB-Tim Sekata, Zabima-Leighton, Mudajaya, MTDC-Persys and Ahmad Zaki.

It is comforting to note that 5 companies under our coverage are still in the running for the main contractor role – Gamuda (BUY, TP RM4.35), IJM (BUY, TP RM6.00), MRCB (BUY, TP RM2.25), Sunway (BUY, TP RM2.10) and WCT (FV, TP RM2.25). We reiterate our view that based on balance sheet strength and past experience alone, we think Gamuda and IJM are the strongest contenders. Having said that, Gamuda may have its hands full should the MRT project take off. 

by HwangDBS Vickers