BNASTRA: Construction Firm Bolsters Order Book with RM305 Million Solar Project, Analyst Reaffirms BUY Rating






Financial News Update: Construction Sector


BNASTRA: Construction Firm Bolsters Order Book with RM305 Million Solar Project, Analyst Reaffirms BUY Rating

Investment Bank PHILLIPCAPITAL
TP (Target Price) RM2.60 (+12.1%)
Last Traded RM2.32
Recommendation BUY

A leading construction firm has significantly strengthened its order book with the recent securing of a RM305 million design-and-build contract for infrastructure and renewable energy facilities in Johor. This development has propelled the company’s year-to-date FY26 new job wins to RM1.9 billion, elevating its outstanding order book to an impressive RM4.8 billion. Following this positive update, investment analysts from PhillipCapital have reiterated their “BUY” recommendation for the stock, maintaining a target price of RM2.60.

Key Contract Win and Financial Impact

The newly secured RM305 million contract from Bahru Stainless involves the design and construction of infrastructure, site clearance, earthworks, civil, structural, and retrofitting works, alongside a substantial 65MWp solar photovoltaic energy and 200MWh battery energy storage system. Situated in Pasir Gudang, Johor, this fast-turnaround project is slated for completion within nine months. Analysts estimate the project’s PAT (Profit After Tax) margin at 7-8%, which is expected to contribute approximately RM21-24 million to the company’s earnings.

Robust Order Book and Future Outlook

With this latest award, the company remains firmly on track to surpass its FY25 replenishment target of RM3.1 billion. The current RM1.9 billion in new job wins for FY26 already positions the group well. Management’s internal replenishment target for FY26 is between RM4 billion and RM4.5 billion. To achieve this, an additional RM2.1 billion to RM2.6 billion in new contracts are anticipated. These are expected to come from significant projects, including the EXSIM Kebun Teh and Lumba Kudah projects (collectively valued at RM1.9 billion) and the Maxim Pelangi project (valued at RM0.8 billion), which are likely to be progressively awarded towards the year-end.

Analyst’s View and Risks

PhillipCapital analysts are maintaining their earnings forecasts as the latest job win aligns with their FY26 replenishment assumptions. The “BUY” rating and 12-month target price of RM2.60 are based on an unchanged target 16x multiple on FY27E EPS. Analysts expressed continued confidence in the company due to its strong competitive advantages, status as a preferred contractor among key clients, and superior profit margins. However, potential downside risks include slower-than-expected order book replenishment, unforeseen project delays, and margin pressures.


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