PARAMON: Solid Performance Across Segments Drives Steady Earnings, ‘Buy’ Rating Maintained

Investment bank TA Securities has reiterated its “Buy” recommendation, maintaining a target price of RM1.46 for Paramount Corporation Berhad, following a review of its nine-month financial performance. The company’s 9M25 core net profit of RM61.2 million was in line with expectations, representing 74.9% of the full-year forecast.

Performance Review

Paramount Corporation Bhd demonstrated resilience in its latest financial reporting period. Net profit attributable to ordinary equity holders saw a significant 21% year-on-year increase to RM36.2 million in 9M25. This improvement was primarily driven by reduced distributions to perpetual securities holders, following a partial redemption of these securities in the third quarter of 2024. Quarter-on-quarter, core net profit for 3Q25 also rose by 15% to RM25.0 million, underpinned by broad-based improvements across all business segments.

The property segment recorded a modest 2% year-on-year revenue increase to RM654.0 million in 9M25, benefiting from higher progress billings from key projects like The Atera (Selangor), Utropolis Batu Kawan (Penang), and Bukit Banyan (Kedah). However, the segment’s Pre-Tax Profit (PBT) marginally dipped by 0.5% year-on-year to RM102.8 million. This slight decline was attributed to a high comparative base in 9M24, which had benefited from one-off project cost finalisation savings.

Meanwhile, the coworking segment delivered a robust performance, with revenue surging 29% year-on-year to RM65.4 million in 9M25. This growth was primarily fueled by increased design-and-build contributions from Scalable Malaysia and enhanced revenue from Co-labs Coworking operations. Consequently, the coworking segment recorded a PBT of RM0.2 million, a substantial improvement from RM24,000 in the prior year’s corresponding period.

Sales and Challenges

Despite the positive earnings, new property sales experienced a slowdown, declining 43% year-on-year and 28% quarter-on-quarter to RM249 million in 3Q25. This brought total 9M25 sales to RM774 million, marking a 22% year-on-year decrease. The moderation in sales was largely due to a 64% contraction in new launches, with total launches in 9M25 amounting to RM716 million compared to RM2.0 billion in 9M24. Key contributors to 9M25 sales included The Atera, The Ashwood at U-Thant, and Embun Hills. Despite the dip in new sales, unbilled sales remain robust at RM1.6 billion, equivalent to 1.6 times the FY25 property development revenue forecast, providing healthy earnings visibility.

Future Outlook

Management anticipates an improved momentum in the fourth quarter of 2025, driven by intensified marketing efforts. The company plans to introduce approximately RM300 million worth of new launches in 4Q25, including townhouses at Salak Perdana, landed residential units at Bukit Banyan, and the affordable component of The Atera in Petaling Jaya.

The coworking segment is also expected to strengthen further in 4Q25, supported by higher occupancy rates at Co-labs Coworking and contributions from Scalable Malaysia’s design and build projects. Additionally, Co-labs plans to expand its footprint with a new space at Mid Valley Southkey, Johor Bahru. TA Securities maintains its FY25-27 earnings forecasts, citing the company’s sales performance as broadly in line with its forecast and management’s RM1.2 billion sales target.