Darma Henwa May Benefit From Contracts Outside Bumi Resources — Market Talk

Darma Henwa may benefit from securing contracts outside of Bumi Resources, for which it is a core contractor, Bahana Sekuritas's Jeremy Mikael says in a research report. The company has secured its first external mining-services contract, appointed as primary contractor at the Sebuku Sejaka Coal pit at Indonesia's Pulau Laut, the analyst notes. The mandate runs for five years and is extendable to concession expiry, with a scope of up to 5 million tons per year of coal at total value of around 22 trillion rupiah. However, the brokerage cuts the stock's target price to 600.00 rupiah from 850.00 rupiah to partly reflect higher risk premium, with an unchanged buy rating. Shares are 4.7% higher at 314.00 rupiah. (ronnie.harui@wsj.com)