Thailand's SEAFCO: An expanding backlog.

Section: Stocks - Government spending is not only the key revenue growth driver for contractors but also strengthens the confidence of the private sector to resume investing in production expansion and big-ticket real estate. A sizable government investment budget signals that contractors' backlogs and earnings will expand. BUY rating is maintained on SEAFCO.

The firm's backlog as of Sept 30 was valued Bt1.6bn, of which Bt400-Bt500m is to be recognized in 4Q09. Moreover, SEAFCO has another new job worth Bt400m, which it will start booking in 4Q09. So, the YE09 backlog should be Bt1.3bn, which accounts for 38% of FY10 revenue projection …