INTA: Robust Order Book Reinforces Strong Earnings Visibility
| Investment Bank | TA SECURITIES |
|---|---|
| TP (Target Price) | RM1.00 (+132.6%) |
| Last Traded | RM0.43 |
| Recommendation |
A Malaysian construction company has secured a significant new contract, further bolstering its already robust order book and reinforcing strong earnings visibility. The latest win, a RM40.6 million contract for the construction of 128 landed residential units, is expected to span 20 months, with completion targeted for June 2027.
Order Book Strength and Market Position
This new project elevates the company’s total outstanding order book to approximately RM1.7 billion. This substantial figure provides a solid 2.5 times cover of its FY24 construction revenue, signaling a healthy pipeline of work. Year-to-date, the company has successfully secured RM865.2 million worth of new jobs, already meeting 86.5% of its estimated new order assumption of RM1.0 billion for FY25. With an existing tender book of approximately RM5.0 billion, the company is well-positioned to achieve its remaining replenishment targets, potentially adding another RM1 billion in fresh orders. Analysts highlight the company’s strong execution track record, established relationships with major developers, and its position as a direct beneficiary of the recovering domestic property market.
Future Outlook and Profitability
The company is anticipated to maintain resilient margins, attributed to disciplined cost control measures. This, coupled with the strong order book, is expected to support both profitability and cash flow stability, leading to improving overall profitability. Current earnings forecasts remain unchanged, as the latest order book replenishment aligns with previous assumptions.
Analyst Recommendation
TA Securities has reiterated its “BUY” recommendation for the stock, maintaining an unchanged target price of RM1.00. The investment bank’s positive outlook is underpinned by three key factors: the company’s role as a direct beneficiary of the robust domestic property sector, strong earnings visibility supported by a resilient order book, and its improving profitability.
