12 Feb 2010 FAJAR & FAJAR-WA CHART - seem like can break resistant

1H10 net profit of RM10.5m was at 33% and 43% of our forecast and
consensus, respectively.

It was up by 56% despite of lower revenue .
The stellar results were mainly due to lower operating cost and higher
project margin. Net margin doubled up to 13% despite of lower revenue
recognised during the period. The project in hand estimated around
RM370m to contribute to Fajarbaru’s topline for at least another one year.


YoY, 2Q10 net profit was up 49% on the back of lower revenue.

The significant jump was mainly due to lower cost of sales and lucrative margin
secured for the ongoing projects namely, Electrified Double Track Railway

and Tampin Hospital. Furthermore, Fajarbaru’s EBITDA margin has also
improved by 7% due to stabilising building material cost. The net cash
position has also improved from 82 sen to 92 sen per share with zero bank
borrowings.


QoQ, ongoing project on track and net margin improves.

Despite of being a small-cap contractor, it has continuously reported relatively strong
net margin around 11% to 15% for the past 3 quarters. For the quarter, the
company had reported 16% net margin which lead to 39% higher net profit
despite of flattish revenue .


Still bidding for LCCT building contract.

It was not a surprise that Fajarbaru lost the two previous bids for the earthworks and runway
contracts for the new LCCT as the company is not going to sacrifice
margin for expertise. The tender for LCCT’s building (estimated to be worth
RM1b) is still ongoing and we believe it has very good chance in winning
the contract given its impeccable previous track record in building and
extending the existing LCCT.


Other government contracts in the offing.

Arising from the previous stimulus package announced last year, more contracts are expected to be announced and given the size of the contracts between RM80m to
RM200m and the expertise required, mid-size contractors with strong
balance sheet are in a sweet spot to secure contracts.


Maintain BUY on lower tar get price RM1.61 (previously RM1.73) based
on 10x PER FY10.

We trimmed down our FY10 and FY11 net profit by 7%
and 4%, respectively, as we delay the assumption on securing of
contracts . Fajarbaru announced a second single tier dividend of 2sen per
share (cumulatively 6sen) which is higher than our expectations of 4 sen.
(Source : KENANGA RESEARCH)
http://www.fb.com.my/images/Kg_100210.pdf



FAJAR SHARE BUY BACK

Date of buy back from	:	05/02/2010
Date of buy back to	:	10/02/2010
Currency	:	Malaysian Ringgit (MYR)
Total number of shares purchased (units)	:	1,170,300
Minimum price paid for each share purchased ($$)	:	1.040
Maximum price paid for each share purchased ($$)	:	1.120
Total amount paid for shares purchased ($$)	:	1,286,382.07
The name of the stock exchange through which the shares were purchased	:	Bursa Malaysia Securities Berhad
Number of shares purchased retained in treasury (units)	:	1,170,300
Total number of shares retained in treasury (units)	:	3,891,270
Number of shares purchased which were cancelled (units)	:	0
Total issued capital as diminished	:
Date lodged with registrar of companies	:	12/02/2010
Lodged by	:	PCA Advisory Sdn. Bhd.