PETALING JAYA: Gamuda Bhd
is poised to exceed its order book target of RM40bil-RM45bil by the end of 2025, driven by a strong pipeline of projects across Malaysia, Australia, and Taiwan.
CGS International (CGSI) Research highlighted that Gamuda believes it may surpass its target, given its robust project pipeline.
“If all of these projects come to fruition and assuming a burn rate of RM1bil per month, Gamuda may end up with an order book of RM59bil by end-2025,” it noted.
CGSI Research reiterated an “add” call on Gamuda, with an unchanged target price of RM6.
As of January 2025, the group’s order book stood at RM36bil, with year-to-date (y-t-d) financial year ending July 31, 2025 (FY25) wins amounting to RM14.5bil.
The group has identified a potential RM35bil in projects with a high certainty of success.
These include the Sabah water treatment plant (RM4bil), additional works for the Penang light rail transit (RM3bil), Mass Rapid Transit Taiwan (RM3bil), and data centre (DC) enabling works alongside a water treatment plant in Negri Sembilan (RM1bil).
Other notable prospects include suburban rail loop system works in Australia (RM10bil) and station works in Sydney and Melbourne (RM6bil).
Hong Leong Investment Bank (HLIB) Research noted the impact these projects could have on Gamuda’s order book, which could reach approximately RM60bil.
“This is a significant upside to existing guidance of RM40bil to RM45bil order book by year-end,” HLIB Research remarked.
The research house remains positive on Gamuda’s DC pipeline and believes the group’s diversified strategy involving land, water, and renewable energy supply will continue to yield contract wins.
Gamuda is expected to sell its Negri Sembilan DC land to a developer in the coming quarters, potentially unlocking additional infrastructure contracts.
Property sales have also been a strong contributor to Gamuda’s performance.
HLIB Research reported that the segment achieved RM1.2bil in sales for the second quarter of financial year 2025 (2Q25), bringing its first half of financial year 2025 (1H25) total to RM1.8bil.
Sales momentum has been particularly encouraging in Vietnam, where the Eaton Park development’s first two phases sold out within a week. Eaton Park Phase 3 and The Meadows Phase 2 are slated for launches in mid-2025.
HLIB Research maintained its “buy” call on Gamuda, with a lower target price of RM5.43, compared with RM6.04.
Meanwhile, TA Research revised its earnings projections lower following Gamuda’s weaker-than-expected performance.
“Our FY25 to FY27 earnings projections are adjusted lower by 18.7%, 13% and 5.8%, respectively,” it noted.
Nevertheless, TA Research maintained its “buy” call with a revised target price of RM5.88, down from RM6.30.
TA Research further highlighted Gamuda’s confidence in achieving its unbilled order book target, citing potential awards such as the Ulu Padas water treatment plant, additional MRT works in Taiwan, and DC infrastructure in Port Dickson.
Collectively, these projects could add RM11bil to the order book. The group is also on track to secure three new DC contracts worth RM6bil by year-end.
Gamuda’s revenue rose 19% year-on-year (y-o-y) to RM4bil in 2Q25, while earnings increased by 5% y-o-y to RM219mil. For 1H25, its revenue rose 32% y-o-y to RM8.2bil, while net profit was up 5% y-o-y to RM424mil.
RHB Research maintained its “buy” call and target price of RM5.83.
The research house expects stronger quarters ahead, supported by increased progress billings from both domestic and overseas projects.
“With an estimated unbilled order book of around RM32bil as of end-2024 and assuming a monthly order book burn rate of RM1bil per month, Gamuda needs RM20bil to RM25bil worth of new wins in 2025,” RHB Research stated.
The brokerage expressed confidence that Gamuda is well-positioned to secure approximately RM35bil in high-certainty projects and potentially another RM12bil in lower-probability contracts.
RHB Research further pointed to Gamuda’s growing involvement in Australia’s renewable energy sector as a key growth catalyst.
“Gamuda’s renewable energy exposure in Australia via early contractor involvement packages has good prospects backed by Australia’s National Renewable Energy Priority List,” it noted.
This list includes 56 projects that could be fast-tracked, providing Gamuda with ample opportunities in the Australian market.
