PETALING JAYA: Gamuda Bhd
is expected to see the beginning of a stronger earnings upcycle in the current financial year ending July 31, 2027 (FY27), says MBSB Research.
The earnings momentum is expected to build as 75% of its order book remains at the mobilisation and early execution stages.
Gamuda’s order book recently hit a record high of RM56bil after the construction giant bagged two contracts in Australia and one in Cyberjaya worth a combined RM2bil.
With the new contract wins on track, CGS International (CGSI) Research said earnings delivery would now be the more important catalyst.
“We believe the earnings inflection point would be in December 2026 at the earliest, when it reports its results for the first quarter of FY27.
“With the recent decline in oil prices, we expect a gradual uplift in construction margins and believe that its S-curve earnings trajectory is intact.
“We are comfortable with our two-year earnings per share compounded annual growth rate (projection) of 24% for FY26 to FY28,” CGSI Research added.
On Aug 13, Gamuda announced that its unit, DT Infrastructure Pty Ltd (DTI), had secured two separate engineering, procurement and construction contracts totalling A$569.1mil (RM1.65bil) from Edify Energy to construct two solar power plants integrated with battery energy storage systems (Bess) in North Queensland, Australia.
The projects comprise an aggregate 360 megawatt (MW)-peak of solar generation capacity and a 1,200MW per hour Bess. Upon completion, DTI will provide ongoing operations and maintenance services for both assets. This marks Gamuda’s second contract win from Edify Energy, following the previous A$1.1bil award in May 2026 to construct two solar-plus-Bess plants in central Queensland.
Separately, Gamuda secured a RM500mil data centre (DC) job in Cyberjaya, covering core and shell works for a six-storey facility targeted for completion in July 2027.
TA Research believes the DC job reinforces Gamuda’s strong position to capitalise on Malaysia’s robust and accelerating DC rollout, underpinned by continued hyperscaler expansion and rising demand for digital infrastructure.
“This should provide Gamuda with a healthy stream of near term DC job replenishment visibility.
“Given the relatively shorter execution cycle of DC projects (at one to two years), we expect these contracts to support a faster order book execution and improve the group’s overall earnings visibility.
“Notably, this contract does not include mechanical, engineering and plumbing (MEP) works, which are expected to be awarded at a later stage.
“We believe Gamuda stands as a strong frontrunner to secure the MEP works portion, given its role as the main contractor for the core and shell portion of this DC job and its established execution capabilities.
“Assuming a 50MW DC capacity with a construction cost of RM20mil per MW and 60% attributed to MEP works, this could translate into an additional RM600mil in potential contract value for Gamuda from the same DC development in the future,” said TA Research.
Quoting Gamuda management, Kenanga Research expects tender outcomes for another DC in Springhill within the year.
Regionally, the company has a high probability of securing another project in Taiwan by the second half of 2026, driven by the continuation of an existing mass rapid transit project in New Taipei City.
The group has also been shortlisted for infrastructure projects in Brisbane and the Northland Corridor Highway in New Zealand.
“We continue to like Gamuda for its strong positioning in upcoming DC tenders, its ability to secure overseas projects, its robust earnings visibility underpinned by a record outstanding order book of RM56bil, and its inroads into the renewable energy space,” Kenanga Research said.
In a separate note, BIMB Research said the two Australian contracts recently won by Gamuda are fixed-price contracts, with an expected profit-before-tax (PBT) margin of approximately 5%.
Based on the RM1.64bil combined value, the research house estimates that the projects could generate about RM82mil in cumulative PBT over the construction period, with earnings contributions expected from FY27 until completion.
“On a cumulative basis, the estimated PBT contribution is equivalent to approximately 1.8% of our combined FY27 to FY28 group PBT forecasts, although actual recognition will depend on the projects’ execution progress.”
Looking ahead, BIMB Research said FY27 and FY28 are expected to capture the bulk of earnings conversion as project execution accelerates.
“At 12.8 times FY28 price-to-earnings ratio, Gamuda is trading well below its historical average of around 18 times, which we believe does not fully reflect the strong earnings growth embedded in its record order book over FY27 to FY28,” it said.
