PETALING JAYA: Gamuda Bhd
is expected to enter a stronger earnings phase, as the company’s sizeable construction orderbook moves into active execution while major infrastructure projects gather momentum.
Its growth prospects over the medium term would also be reinforced by an expanding property pipeline and disciplined project delivery.
MBSB Research said these factors underpin its positive outlook after a site visit to the Gamuda-led SRS Consortium’s Penang light rail transit (LRT) Mutiara Line civil main contract package one (CMC1) training centre.
The research house maintained its “buy” recommendation on the stock with an unchanged target price of RM5.60.
“Gamuda remains our top construction pick, supported by its record RM52.3bil order book and improving earnings visibility,” it said.
“As 75% of projects remain at the mobilisation and early execution stages, we believe financial year ending July 31, 2027 (FY27) will mark the beginning of a stronger earnings upcycle,” it added.
Beyond construction, Gamuda’s property division is also entering its next growth phase, underpinned by a RM10bil launch pipeline in FY27 across Vietnam, Singapore and Malaysia, MBSB Research said.
The brokerage, which visited the RM7.93bil CMC1 project last week, noted that physical progress had reached 8%, ahead of the planned 4%, while station precast production has already commenced, citing Gamuda’s management.
The 23.7-km project covers elevated guideway works from Silicon Island to Komtar, comprising 19 stations, one provisional station and a depot, representing about 80% of the overall 29.5-km Mutiara Line.
“Management highlighted that station construction remains the project’s critical path, given requirements on architectural, mechanical and engineering, and system integration,” MBSB Research said.
Viaduct launching is scheduled to begin by the end of 2026, with track installation expected to accelerate throughout 2027, while all station structures are targeted for handover to the systems contractor by December 2028.
MBSB Research said Gamuda had revealed that reclamation works for the 65-acre Silicon Island depot and LRT corridor have been handed over, enabling depot construction to proceed, while demand for Silicon Island continues to be supported by enquiries from artificial intelligence, semiconductor and electrical and electronics investors.
“CMC1 and Silicon Island account for 18.5% of Gamuda’s outstanding order book, underpinning earnings visibility over FY27 to FY31. Meanwhile, we view the pending RM3bil to RM4bil systems package award as a re-rating catalyst for the company,” it said.
