PUBLIC: Secures Key Contracts, Bolstering Order Book and Future Visibility

A prominent construction company has secured two new contracts with a combined value of RM197.7 million, significantly boosting its outstanding order book and providing enhanced earnings visibility for the coming years.

Contract Details

The first contract, valued at RM100.2 million, involves the construction of a 39-storey serviced apartment building, Viera 15, in Shah Alam, Selangor. This project, awarded by Serta Usaha Sdn Bhd, encompasses 479 service apartment units along with comprehensive facilities and infrastructure. Work is slated to commence on November 17, 2025, with an expected completion timeline of 34 months.

The second contract, worth RM97.5 million, was awarded by Tanjung Pinang Development Sdn Bhd. It pertains to the construction of five canal bridges at Andaman Island, Penang, specifically connecting Fasa 2A to 2B and Fasa 2C on reclaimed land at Seksyen 2, Bandar Tanjung Pinang. This project is set to begin on November 24, 2025, and is anticipated to be completed within 33 months.

Financial Impact and Outlook

These new awards are expected to contribute approximately 9.9% towards the company’s ambitious FY25 job replenishment target of RM2.0 billion. With these additions, the group’s outstanding order book has increased by 5.6%, now standing at a robust RM3.7 billion. This substantial order book is projected to provide strong earnings visibility for the next two to three years.

Year-to-date, the company’s new contract wins have reached RM1.16 billion, representing 57.8% of its FY25 replenishment target. While these projects are integral to the FY25 order book replenishment assumptions, analysts do not foresee immediate changes to current earnings forecasts. The contracts are estimated to generate a profit of approximately RM19.8 million over the 34-month construction period, based on low-teen profit margins.