KLSE Construction Stocks in play throughout 2010?

Construction Sector's stocks will stay in play throughout whole 2010? Yes, very strong likely. With multi billion infrastructure projects, we will see more of them. As the MP10 (2010-2015) government's spending would be within RM230 billion, construction stocks will stay be our focus throughout 2010. (the government expects more of private sector's role which is we need to wait and see after Northern Corridor and Eastern Corridor?)

Here

is some major infrastructure projects:

9MP projects flowing into 10MP:

Double tracking rail – Northern (Ipoh-Padang Besar) RM12,485 mil
Construction in progress (estd. 30% completed).
Main contractor is MMC-Gamuda JV.

Double tracking rail – Southern (Seremban-Gemas) RM3,400 mil
Construction in progress (estd. 10% completed).
Main contractor is IRCON, while sub-contractors are IJM Corp, Loh & Loh, and Fajar Baru.

Pahang-Selangor water transfer (45km tunnel) RM1,300 m
Land clearing started.
Main contractor is Shimizu-NishimatsuUEM Builders-IJM Corp consortium.

Pahang-Selangor water transfer (upstream: Kelau Dam,pumping station,pipes) RM1,200 mil
Pre-qualification for some packages have started. We expect first award from end-2009.
Potential beneficiary is Loh & Loh.

Sepang low cost carrier terminal (LCCT) RM2,000 mil
Bidding for the main work packages is ongoing.
The project is scheduled for completion by 3Q2011. First award expected this week.

Klang Valley LRT extension (Kelana Jaya-Putra Heights-Sri Petaling, 17km x 2) RM7,000 mil
Proposed line alignment is opened for public comments until 15 Dec 09. We expect the first award in 1Q2010. IJM Corp, Gamuda, WCT, Sunway, Loh & Loh, UEM Builders, Mudajaya, MRCB and Scomi are the potential beneficiaries.

Penang Second Bridge RM`4,300 mil
Main cont

ractors are CHEC (sub-structure), and UEM Builders (upper structure)

East Coast Expressway, Phase 2 RM 3,000 mil
Package 10 under MTD Cap is >6)% completed, while construction progress on the other packages are believed to be slow (<30% completed).

Projects likely to start during 10MP :

Double tracking rail – Southern (Gemas-Johor Baru) RM 8,000
Chinese contractors have been offered a role in project construction during PM Najib’s diplomatic visit to China on 2-5 Jun, 2009.

Pahang-Selangor water transfer (downstream: Langat 2 treatment plant) RM 5,000
Kumpulan Darul Ehsan has been awarded the contract in Feb ’08 by the federal government. Main contractor is likely to be Kumpulan Perangsang Selangor, being a 60%-subsidiary, while Gamuda and Loh & Loh may benefit from sub-contracting works.

New Klang Valley LRT line (Kota Damansara-Cheras) (40km) RM 9,000 mil
All major contractors, i.e. IJM Corp, Gamuda, WCT, Sunway, Mudajaya, UEM Builders, MRCB and Scomi could be eyeing for a piece of the works.

Bakun Undersea Cable RM 9,000 mil
Project owner is Sarawak Hidro, a unit of the MoF. Earlier, it was expected that MRCB could be appointed the contractor.

Papar-Penampang (Sabah) dam and water treatment plant RM 2,800 mi
Approved by the Sabah state government in Apr 09, the project is believed to be a private finance initiative (PFI) project. Likely beneficiary is WCT.

Total RM 68,485 mil (RM 68.48 billion)

Note: Projects in orange font are yet to be awarded

Project list source: Maybank Investment