CGS-CIMB maintains “overweight” rating on construction sector amidst high-speed rail revival excitement
CGS-CIMB said a crucial factor for the high-speed rail project’s success is getting the buy-in from the Singapore government.
According to the research house, some of the companies believed to be shortlisted include WCT Holdings Bhd, MMC Corp Bhd, and YTL, amongst others. To date, some 30 companies have submitted requests to obtain the RFI documents. “YTL stands out as a potential front due to its historical role as the original HSR promoter in 2008-2009. In addition, they were appointed as project delivery partner for the HSR southern section in 2018.
However, as the project is in the RFI stage, CGS-CIMB highlighted that several important details remain undisclosed, such as the potential cost, land acquisition, and project timeline, amongst others.Additionally, CGS-CIMB said a crucial factor for the HSR project’s success is gaining approval from Singapore and addressing past issues such as the AssetCo structure and connecting the HSR terminus in Kuala Lumpur to the ERL.
“The HSR will primarily target for business travellers who value time whilst the medium-speed double-tracking line is catered to accommodate budget-conscious passengers. In a subsequent phase, there is a potential for the HSR to expand its reach to Bangkok,” it added.