PETALING JAYA: Analysts are turning positive on UUE Holdings Bhd
’s outlook, supported by a Singaporean expansion, new solar tender opportunities and higher high-density polyethylene (HDPE) pipe sales.
In a report, RHB Investment Bank Bhd said the underground utilities engineering solutions provider plans to add two horizontal directional drilling (HDD) projects in Singapore by the end of next month, bringing the number of total teams to 12.
UUE Holdings is also targeting to have 15 teams within a year as main contractors push for faster delivery.
“Positively, it indicated that third quarter (3Q) billing momentum has held after the 2Q revenue doubled quarter-on-quarter to RM20.2mil,” the research house said.
“We pencil in the second half of financial year 2027 group revenue of RM154mil.”
According to RHB Investment, the group’s margins are structural – UUE Holdings’ management expects blended gross profit margins to hold at between 25% and 30%, and a profit after tax margin of 15%.
The Singaporean segment margin is between 30% to 35% – its management sees improvement for the Malaysian unit.
“The 0.8 percentage points quarterly gross profit margin dip in 2Q reflected lower HDPE pipe manufacturing, after it benefited from cheaper raw materials in 1Q. Meanwhile, the higher 2Q tax rate reflects a one-off under-provision in Singapore,” RHB Investment noted.
It added the group’s replenishment is another factor for its positive outlook.
The research house said UUE Holdings year-to-date wins stand at RM133.1mil, but the research house has cut its financial year 2027 replenishment assumption to RM240mil from RM320mil, as well as trimmed revenue for FY27 to FY29 by 5% to 11%.
