BERHAD: Major Contract Win Bolsters Order Book, Outperform Rating Maintained

A significant new contract win is set to bolster the order book for a prominent Malaysian builder, reinforcing its positive outlook. The group, through its 50:50 joint venture, has secured a substantial AUD994 million (approximately RM2.7 billion) contract from Marinus Link Pty Ltd for the Marinus Link subsea cable project.

Contract Details and Scope

The contract encompasses the civil, structural, and electrical infrastructure development required for the project’s initial stage. This includes the construction of vital converter station buildings, execution of land cable civil works, and associated onshore installation tasks. This phase of construction is scheduled to commence in early 2026 and is projected to span five years.

The company’s allocated share of this major contract is approximately RM1.3 billion, underscoring its significant involvement in a crucial infrastructure development project.

Order Book Enhancement and Future Outlook

This latest award has notably increased the group’s total outstanding order book by 3.6%, bringing it to an estimated RM37.9 billion. The project is anticipated to contribute an annual net profit of approximately RM9.8 million throughout its construction period.

Public Investment Bank notes that this significant contract win aligns with its previously assumed order book replenishment target of RM30 billion by the end of CY26. Consequently, the bank has maintained its earnings estimates without adjustment. The investment bank reiterates its Outperform call on the company, with an unchanged sum-of-the-parts (SOTP)-based target price of RM6.20, signalling continued confidence in its growth trajectory and operational execution.