| INGRESS
Corp Bhd appears well on its way to becoming a solid
company with its strong holdings in the business
of automotive components, power engineering and
railway electrification.
Even though its current focus on
automotive components has received lukewarm response
from the investing community following sliding sales
of national cars, its other divisions hold a lot
of potential in view of the impending announcements
of major contracts in the near future.
The stock attracted buying interest
recently when news of the RM14.5bil electrified
double tracking railway project linking Padang Besar
and Johor Baru broke out. From RM2.50, the share
price rose to a high of RM2.83 with strong volume,
but continued to consolidate at around RM2.50 subsequently.
Ingress, through its associate
Balfour Beatty Rail Sdn Bhd, is part of the consortium
bidding for electrification works in the billion-ringgit
project.
Already, it is involved in the
Ipoh-Rawang track but progress has been hampered
by delay in civil works.
“Contribution from this business
remains low for now, but front-end activities are
progressing in anticipation of civil works acceleration,”
said executive vice-chairman Rameli Musa in an interview.
On the power engineering division,
he said sub-station business would remain Ingress'
core activity and the company was about to commence
talks on a power purchase agreement (PPA) with Tenaga
Nasional Bhd on the two mini-hydro projects.
“If everything goes well, we will
start the construction of two dams early next year
with completion time expected to range between 12
and 18 months,” he said.
But in the meantime, automotive
components will still be the revenue churner for
the group and the company is banking on Perodua's
strong niche in the compact car market and its Thai
operations to stay competitive.
“Ingress is relatively shielded,
thanks to the exclusivity status on components such
as sash, door-in-white, bellows and mouldings,”
he said.
He said even though the first half
results were below expectation due to the overall
decline in domestic sales, it was mitigated by stronger
than expected performance from its Thai operations.
The company recorded lower profit
before tax of RM7.1mil in the first half to July
31, on revenue of RM71.7mil. The decline was due
to the slide in national car sales.
Of the RM7.1mil, the local components
operation contributed RM4.9mil, Thai operations
RM2.9mil while power engineering and railway recorded
a loss of about RM700,000.
“For the second half, we anticipate
an improvement in performance due to continued strong
performance from Thailand and steady contribution
from Perodua. We will continue to focus on regional
markets which will ensure our medium- to long-term
growth prospects,” Rameli added.
Revenue growth for its Thai operations
will remain strong at 50% for the current year ending
Jan 31, 2004.
Rameli said Indonesia meanwhile,
would begin contributing positively in the financial
year ending Jan 31, 2006.
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