RHB Research has upgraded its “neutral” call to “buy” on Pestech International Bhd, with a target price of RM4.16, following the recent share price retracement.
In a research note yesterday, the research house said since the retracement, valuation has become attractive.
Industry prospects remained intact as Tenaga Nasional Bhd is planning to spend RM23.3 billion as capital expenditure from 2014 to 2017.
Internally, Pestech is focusing on two new business segments to propel future growth.
“As at end-September this year, it had a total order book of about RM546 million,” the research firm said.
RHB Research said Pestech was reshuffling its focus for long-term prospects.
“The transmission and distribution segments have been contributing over 80 per cent towards its total sales in the past few years since its listing in 2010,” it said.
Pestech shares closed higher at RM3.45, with 98,100 units traded. Bernama