Tim Cohen Senior editor: Business Day

The construction sector has the potential for massive growth. Yet investor sentiment suggests that SA’s construction companies are priced for stasis at best and ongoing blood-letting at worst. The scale of the upturn, should it occur, could be really dramatic. In 2005, the then sector leader Murray and Roberts was trading at R14 but within three years it was trading close to R100, a return of just more than 600%. Now it is trading back at about 2005 levels and has been for years. Few, if any people, are suggesting that kind of return will be repeated soon, but signs of a sentiment change have been visible recently, partly as a result of SA’s new political leadership and partly out of a hope that new investment — local and foreign — will change the fortunes of arguably SA’s most crucial and most beleaguered sector. A measure of just how out of favour the sector has become is reflected in Group Five’s market cap, which is hovering around a quarter of the company’s cash on its balance ...

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