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New Straits Times
20-05-2025
- Business
- New Straits Times
Hartanah Kenyalang poised for growth amid Sarawak infrastructure boom
KUALA LUMPUR: Hartanah Kenyalang Bhd's earnings are expected to grow at a two-year compound annual growth rate (CAGR) of 16 per cent, according to Public Investment Bank Bhd (PublicInvest). In a note, the firm said this will be supported by a robust order book and continued government infrastructure spending in Sarawak. "We derive a fair value of RM0.22 by applying 11 times the forecast price-to-earnings ratio (PER) for financial year 2026 (FY26), which represents an approximately 20 per cent discount to the forward PE multiple of 14 times for Bursa's Construction Index. "This account for the group's positive outlook but relatively smaller scale of business," it noted. Going forward, PublicInvest said key downside risks for the group include dependency on government spending in Sarawak, competition, and reliance on labour and subcontractors. Hartanah Kenyalang is a Sarawak-based construction services firm, well-positioned to benefit from steady construction growth in the state. Through its subsidiary, the group is principally involved in building construction services, focusing on institutional buildings such as schools and other public buildings, as well as other non-residential buildings, and infrastructure construction services, particularly bridges and roads. According to PublicInvest, the group is qualified to undertake high-value building and infrastructure construction services for government projects, mainly for public buildings, bridges and roads in Sarawak. The group plans to capitalise on Sarawak's RM10.9 billion development budget for 2025 and continue bidding for public sector projects, including schools and other purpose-built buildings, high-rise buildings, bridges, roads, and substations. Besides enhancing operational capacity and efficiency, the group also aims to expand its design and build services through building information modelling (BIM) investment. Between FY21 and FY24, Hartanah Kenyalang's net profit increased from RM4.8 million to RM9.2 million, registering a CAGR of 24 per cent in line with higher revenue. However, the net profit margin declined from 14 per cent in FY22 to seven per cent in FY24, while the gross profit margin decreased from 24 per cent in FY21 to 18 per cent over the same period. The decline was primarily due to the completion of the higher-margin Pan Borneo Highway Project, coupled with rising costs for construction materials, subcontractors, staff costs, finance costs and other operating expenses. The group is seeking a listing with an enlarged issued and paid-up share capital of 620 million shares on Bursa Malaysia's ACE Market. Pursuant to the initial public offering (IPO) listing, the group's market capitalisation is RM99.2 million based on its IPO price of 16 sen.
The Star
15-05-2025
- Business
- The Star
FBM KLCI struggles for momentum amid cautious buying interest
KUALA LUMPUR: The FBM KLCI struggled to maintain its upward momentum due to weak buying interest, closing the morning session lower. At midday, the FBM KLCI slipped 8.57 points or 0.54% to 1,574.94, just marginally higher than its intramorning low of 1,574.13. Gainers numbered 396, trailing losers at 513, while 471 counters remained unchanged. Trading volume stood at 2.4 billion shares, valued at RM1.3bil. Nestle, the top decliner, fell 82 sen to RM83.98, followed by Kluang, which lost 40 sen to RM5.56. PETRONAS Dagangan eased 32 sen to RM20.22, while Tenaga declined 18 sen to RM14.12. Among the gainers, Malaysian Pacific Industries rose 42 sen to RM21.74, Heineken added 24 sen to RM27.74, Carlsberg gained 22 sen to RM19.38 and Chin Tek climbed 11 sen to RM8.30. TA Securities said the local market should stay in consolidation mode as investors will likely remain cautious ahead of the release of Malaysia's first-quarter GDP data later this week. 'Immediate resistance remains at 1,610, with the next major resistance seen at 1,644, followed by the August 2024 high of 1,684. Immediate support is maintained at 1,526, with 1,490 and 1,444 acting as stronger supports,' it added. Meanwhile, Malacca Securities remains optimistic about the outlook for blue-chip stocks, citing strong fundamentals and stable dividends as key drivers amid renewed foreign fund inflows into the Malaysian market. The research house said that despite global headwinds from US tariffs and geopolitical tensions, Bank Negara Malaysia's move to lower the Statutory Reserve Requirement (SRR) from 2% to a 14-year low of 1% may boost loan uptake among businesses and help stimulate economic growth. 'We maintain a positive outlook on the construction sector, driven by ongoing data centre investments and major developments across the country, such as the JSSEZ. The Construction Index has also broken above its MA200 resistance,' Malacca Securities said.
Irish Times
13-05-2025
- Business
- Irish Times
Construction activity increased in April, but was slowest on housing
Construction activity in Ireland continued to increase during April, but the slowest increase in activity was on housing projects, according to AIB. The bank's Construction Total Activity Index posted 52.4 for April, down from 53.9 in March. This indicates a slowdown in activity but was still above the 50 mark, which signals growth in the month. AIB said the slowest increase in activity was on housing projects (at 51.7), but growth has now been sustained in the residential category for eight months running. Employment and purchasing activity increased, while companies remained optimistic regarding the year-ahead outlook, despite some worries regarding the impact of US trade policy. READ MORE On the price front, firms recorded a further sharp rise in their input costs during April. Those firms that saw construction activity increase linked it to improving customer demand and an associated increase in new orders. Indeed, new business expanded for the third successive month in April, with the solid pace of growth little-changed from that in March. The rise in construction activity was broad based. The fastest increase was in commercial activity, which expanded for the third month running and at a solid pace, albeit one that was softer than in the previous survey period. Civil engineering activity, meanwhile, rose at the fastest pace since February 2022. The slowest increase in activity was on housing projects, but growth has now been sustained in the residential category for eight months running. With new projects getting underway, construction firms again felt the need to hire additional workers in April. Employment rose for the second month running, and at a slightly stronger pace than in March. The usage of subcontractors also increased, following a first fall in seven months in the previous survey period. April also saw sustained growth of purchasing activity, while suppliers' delivery times lengthened as staff shortages meant that vendors struggled to keep up with rising demand for inputs. Improving demand for materials often resulted in suppliers hiking their prices in April, with the rate of input cost inflation remaining sharp and above the series average during the month. Sub-contractor rates also increased rapidly, and at the fastest pace for a year. Hopes for improving economic conditions and further inflows of new orders supported confidence in the 12-month outlook for construction activity. Sentiment picked up from that seen in March, but remained weaker than the series average amid some nervousness about the potential impacts of US trade policies. Around one-third of respondents expressed an optimistic outlook, while 11 per cent were pessimistic.
