Ekovest Bhd: A relook into Ekovest Bhd from Profitability, Volume Spread Analysis and what’s Insiders Report are telling they are doing Now ?
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Ekovest Bhd (8877.KL) listed in the Bursa Malaysia
Background of Ekovest Bhd (8877.KL)
Founded by the group’s two existing Executive Directors (Tan Sri Dato’ Lim Kang Hoo and Khoo Nang Seng), Ekovest Bhd made its debut on the then Second Board in 1993 and was promoted to the Main Board in March 2000. Ekovest has expanded significantly between FY14 and with sales were up by 3.6x in four financial years, staying above the RM1b mark in the last two financial years
Ekovest Bhd business segments are Construction operations, Property development, Investment holding and Toll operations. The Company’s construction projects include Danga Bay, Kuala Lumpur Central Commuter Station, Labuan Financial Park, Office Building Petronas Carigali, Petronas Twin Towers, Putrajaya and Universiti Malaysia Sabah. Its property development projects include Eko Titiwangsa, Eko Cheras and Oasis Kajang. Its infrastructure concession projects include DUKE Highway and Solar Panel at Batu Toll Plaza.
Ekovest Bhd revenues increased 29% to RM1.34B, for the year ended 30 June 2019. Net income increased 12% to RM140.5M. Revenues reflect an increase in demand for the Company’s products and services due to favourable market conditions. Net income was partially offset by Interest expense increase of 27% to RM204.2M (expense), Administrative and general expenses increase of 43% to RM104.4M (expense).
A Quick Fundamental View for Ekovest:
- P/E Ratio = 14.65
- ROE = 5.75%
- DY = 0 (No dividend payout)
- Currently Ekovest is trading at overpriced.
Recent Insider Report for Ekovest Bhd (Bursa Malaysia)
Tan Sri Lim Kang Hoo is the founder, chairman and chief executive of Iskandar Waterfront Holdings and Ekovest Berhad. Both corporations manage infrastructure construction projects, as well as mega property development. Within this Insider Report, Tan Sri Lim Kang Hoo was a good business partner with previous BN government with direct connection to ex-PM, Najib Razak. He was major controlling stakeholder in Bandar Malaysia property development back in
2017 through IWCity but has reconfirmed it is no longer involved in Bandar Malaysia project in Apr 2019. Through this turn of unfortunate events, Ekovest Outlook is not so rosy.
It is interesting to note that in the Insider Report, when owner of the company, Tan Sri Lim Kang Hoo increased its stake, he will have relative confidence in its own company. Tan Sri Lim has increased his stake by 2.4%. In light of this event, EPF also too increased its stake to almost 5% as of the Top 10 shareholders of Ekovest Berhad of this Insider Report.
As you can also see from the Insider Report alone, Lim Seong Hai Holdings S.B is likely allied business partner to Tan Sri Lim Kang Hoo. Tan Sri is likely to maintain major control on Ekovest. Combining of them, they controlled almost 40% of the Ekovest in the Insider Report. With the recent purchase by Tan Sri Lim Kang Hoo, Lim Seong Hai Holdings @ RM0.85-0.87 estimated, I believe it will form a good support despite we see breaking down of Ekovest to RM0.75 (base of double bottom support). Ekovest outlook from the price standpoint seen worrying but from floating shares of Ekovest outlook, it is stable.
Known Major Shareholder(s) As at 10th Oct 2018
20.1 % Tan Sri Dato’ Lim Kang Hoo
12.19% Ekovest Holdings Sdn Bhd*
7.19% Lim Seong Hai Holdings Sdn Bhd^
* Tan Sri Dato’ Lim Kang Hoo is deemed interested
^ Tan Sri Datuk Seri Lim Keng Cheng is deemed interested
Market Cap: RM 1.625 B, Number of Shares: 2.14 B, Float: 42.76%. The three major stakeholder almost 40% of the floating shares.
Profitability Analysis of Ekovest Bhd Outlook
The profitability of Ekovest with its low single digit of return on equity may deem on good profitability of Ekovest outlook. Its highly leverage financing will ensure future of Ekovest outlook in term of profitability remained deem until many of the construction and engineering high ticket projects are revived by the government. I like to see an increase in the return of equity figures for
2020 and beyond to make this a stable and steady share of Ekovest to hold providing Construction Malaysia Outlook look good which it is not in year 2019.
Ekovest’s Outlook (Trading) – Weekly & Daily Chart VSA (Volume Spread Analysis) Review
The overall view and Ekovest Outlook (trading) in weekly chart shown changed in trend after the high volume with strength. We notice the weeks before the Line Change with high volume, No Supply (NS) signal is spotted at the support level. The NS signal alerted us the sellers are getting lesser and Smart Money is ready to re-test the resistance.
The current setup and Ekovest outlook (trading) show slightly weak as bearish signal have appeared in the weekly chart. Notice in this accumulation stage, the support level is well supported at the Spring bar. We’ll probably see another shakeout pattern soon. Looks for entry only if the shakeout completed.
Ekovest’s outlook (trading) and setup in daily chart do show weakness too by breaking below the major support level. In the TradeVSA chart, we notice lots of sign of strength at RM0.79 (support). Signals like Test bars appeared several times and show the intention on Smart Money to check the supply level by weak-hand holders. The Up-Thrust at the resistance is too huge with volume, and Smart Money need to ensure all weak hand holders have been removed in the market before re-test resistance.
Based on the filing date of the Insider Report of Ekovest Berhad, we also noticed the buying by the insiders are pretty close to support level. The price might break below the major support level, however if we look closely on the volume, the volume on the downbar is average. We believe the price likely to test at RM0.715 again at the previous shakeout area. Looks for Spring bar or complete shakeout for trading opportunities.
*Pentagon Guider System has Buy or Sell Indicator indicated by Green Pentagon Icon and Red Pentagon Guider Icon in the field of Volume Spread Analysis. However, we advised reader that not all pentagons are buy or sell taken literally 100% of the time in Volume Spread Analysis method.
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