Industrials: Doosan Corp, SCREEN Holdings, Gamuda Bhd and more

• Park Yong-maan, Park Seo-won and Park Jae-won are looking to sell down their stakes in Doosan Corp (000150 KS) . The share sale will be a cleanup.
• In our view, the deal should bode well for the current management, giving them free rein in management coupled with the share sale being a clean-up. 
• In this note, we will talk about the firm’s track record and run the deal through our ECM framework.

• The former Doosan Group Chairman Park Yong-Man and his sons will sell 1.296 million shares of Doosan Corp (000150 KS) in a block deal, representing 7.85% of outstanding shares.
• We have a positive view of this block deal sale and we would take the deal.
• Our NAV analysis of Doosan Corp suggests NAV per share of 188,511 won per share, representing a 61% upside from current levels. 

• The share price has bounced back from the Ukraine war sell-off. Attention should now shift to orders, sales and profits. 26% potential upside to our price target
• New SPE orders exceeded sales by 20% in the December quarter, taking the backlog to a new high and pointing to further sales and profit growth next fiscal year.
• Management’s FY Mar-22 guidance remains unchanged, with sales up 41% and operating profit up 2.2x. Upside potential of 26% to our price target.

• Remains our preferred pick; BUY
• Property provided the lift
• MYR15.6b E&C orderbook + unbilled property sales
• Revising FY22E forecast; raising minimum wage

Gamuda’s earnings rebound in 2QFY22 was stronger than expected, with 1HFY22 net profit (+41% YoY) coming in at 55% of house/street’s full-year forecasts; the beat was due to margin expansion at its E&C ops. We raise FY22E net profit by 10%, maintain for FY23/FY24E. Our RNAV-TP is unchanged at MYR4.28. We continue to like Gamuda for its delivery track record, strong balance sheet and ESG initiatives. Maintain BUY.