PETALING JAYA: IJM Corp Bhd
’s expanding construction order book and the prospect of a future listing of its construction arm could help unlock shareholder value.
Rakuten Trade head of equity sales Vincent Lau said IJM’s share price has retreated significantly and is now well below the implied value under Sunway Bhd’s proposed acquisition offer.
As a result, there is greater pressure on IJM to create and unlock value.
“While some estimates suggest IJM is worth substantially more than its current market value, achieving that valuation will not be easy.
“One potential avenue is the listing of its construction arm, although that would likely take time to materialise. In the meantime, the company continues to secure construction jobs, which should provide support,” he told StarBiz.
Meanwhile, CIMB Research said financial year 2027 (FY27) will be a recovery year for IJM’s property division.
The research house said that despite a challenging operating environment, the group is targeting RM1.9bil to RM2bil in new property sales for FY27, compared with RM1.8bil in FY26, alongside RM1.1bil worth of new launches.
This will be supported by land sales in India, which are expected to be realised by the first quarter of Y27.
Holding an optimal landbank of over 3,000 acres, IJM is also building up its portfolio of investment properties and industrial parks.
This includes the IJM-Southern Catalyst Sdn Bhd joint venture to develop a 307-acre in Sedenak, Johor.
The group is also unlocking value from its pocket landbank, including the transit-oriented development at Cochrane MRT Station, CIMB Research said in a report yesterday.
It said IJM bagged about RM8bil worth of new construction jobs in Malaysia and Singapore in FY26, including two data centre (DC) projects worth RM3.5bil, the New Pantai Expressway extension valued at RM1.4bil, and Harbourfront Centre (S$390mil, based on a 46% stake in Hexacon Construction).
“For FY27, IJM has maintained a more modest new order book win target of RM6bil.
“While the group’s tender pipeline remains healthy, the timing of awards for some jobs may take a tad longer to materialise owing to the evolving geopolitical situation.”
Key job bids include additional DC projects, the Penang International Airport expansion, the Penang light rail transit, several road projects in Sarawak and hospital projects.
Despite rising diesel and input costs stemming from the Middle East conflict, IJM does not expect any significant impact on construction margins for now, the research house said.
CIMB Research said other key developments include improving cargo volumes at Kuantan Port, with IJM Corp expecting throughput to rise to between 22 million and 23 million tonnes in FY27, from 20.6 million tonnes in FY26, following the completion of major maintenance works by a key customer in April 2026.
“IJM has also rolled out its Smart ICP factory in Bestari Jaya, which will increase productivity and lower production costs for its larger-diameter spun piles,” the research house said.
CIMB Research said the group has also reiterated its commitment to return RM3bil to shareholders over FY27 to FY29.
This hinges on the proposed listing of IJM Construction, comprising its Malaysian operations and Hexacon, which is targeted for the third quarter of 2027.
The proposed listing is expected to account for RM1.3bil of the distribution plan.
The remaining distributions are expected to come from the monetisation of Malaysian toll road assets through various structures (RM575mil), the group’s exit from the Indian market (RM165mil), and the formalisation of a 40% core profit dividend payout policy.
CIMB Research maintained its “buy” call on IJM with an unchanged target price of RM2.95.
