PETALING JAYA: Integrated facilities management and engineering services provider AWC Bhd
is reinforcing the company’s status as a top-tier subcontractor to construction outfit Gamuda Bhd, says Apex Securities Research.
The research house has maintained a “buy” recommendation on the stock with a target price of RM1.25 from RM1.22 after the company secured another contract valued at RM39.7mil for water and fire services at a hyperscale data centre (DC) in Bandar Spring Hill, Port Dickson from Gamuda.
It has also raised financial year ending June 30, 2027 (FY27)/FY28 core net profit forecasts by 2.4%/2.2% to RM30.1mil/RM37.6mil.
It pointed out that the company’s engineering arm’s order book assumption has been revised to RM89.1mil from RM62.3mil after year-to-date wins of RM62.8mil.
Engineering has also become the company’s clearest near-term growth driver, as DC jobs convert into earnings within one to two years.
The latest contract, the third from Gamuda this year, follows previous awards for Rawang (RM19.9mil) and Puncak Alam (RM42.3mil).
Furthermore, the research house views this positively, as repeated awards solidify the company as an established vendor in Gamuda’s subcontract space, not a one-off.
“As these projects roll out in phases, follow-on packages at the same sites could follow.
“The 14-month timeline also converts into earnings faster than AWC’s long-dated concessions,” it said.
Assuming a 12% profit after tax (PAT) margin, it estimates RM4.8mil PAT over the contract period, with RM3.5mil to be recognised in FY27, comprising 12% of FY27’s core net profit of RM30.1mil.
Including this win, AWC’s order book rises to RM900mil (two times FY26 revenue), from RM860.5mil.
