MGB's latest job win on track to achieve firm's FY25 order book target
This represents a healthy 2.1-times cover of Mercury Research's financial year 2025 (FY25) construction sector revenue forecast.
Mercury Research maintains its FY25-FY26 earnings forecasts and RM700mil order-book replenishment target, as the latest contract win is within its expectations.
Mercury expects MGB to remain on track to achieve its FY25 order-book replenishment target.
This is supported by the upcoming LBS Bina Group Bhd 's planned RM2.6bil gross development value worth of property launches in the second half of FY25 and potential contributions from its own pocket land developments in Puchong and Cameron Highlands.
Besides, MGB's first deal with Creed Group could pave the way for future wins from CI Medini's multi-phase Iskandar Puteri projects, diversifying its client base and strengthening revenue resilience.
MGB has secured a RM186mil construction job from CI Medini Sdn Bhd to develop a two-phased serviced apartment in Iskandar Puteri, Johor.
As the win is within Mercury's orderbook assumption, it has maintained its valuations. It reiterates its 'buy' call with an unchanged sum-of-parts-derived target price of RM1.09 a share.
This values the construction division at 11 times the FY25 earnings per share and the property segment at a 40% discount to revalued net asset value.
The research house continues to like MGB for its focus on affordable housing and healthy construction order book, complemented by its expertise in IBS solutions.
The contract was secured from an external client rather than parent company LBS Bina Bhd.
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