PETALING JAYA: Gadang Holdings Bhd
’s property division is expected to remain a key contributor, driven by attractive sales incentives and an aggressive pricing strategy.
According to TA Research, the group’s construction order book stood at RM1bil as of end-November 2024, equivalent to 3.6 times its financial year 2024 (FY24) construction revenue, with unbilled property sales at RM329mil.
Following stronger-than-expected financial results for the first half of FY25 (1H25), TA Research revised its earnings estimates for FY25-FY27 upwards by 14.5%, 4.9% and 4.1%, respectively.
As a result, it raised its target price to 42 sen per share from 31 sen previously, upgrading its rating on the stock to “buy.”
Excluding a one-off gain of RM6.5mil, Gadang reported 1H25 core earnings of RM6.9mil – beating TA Research’s expectations.
The improvement was mainly driven by higher-than expected project margin in construction divisions, supported by better operating cost measures.
Year-on-year, its 1H25 revenue rose by 11.8% to RM326.3mil, led by higher progress billing from its existing construction projects.
Quarter-on-quarter, its 2Q25 topline advanced by 19.7%, supported by higher revenue recognition from its construction projects, coupled with improving project margins.
As a result, its quarterly core profit jumped from RM1.1mil to RM5.8mil, the research house said.
