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New Straits Times
16-05-2025
- Business
- New Straits Times
Analysts expect Axiata's core earnings to remain subdued until FY2027
KUALA LUMPUR: Analysts are projecting subdued core earnings per share (EPS) for Axiata Group Bhd in the financial years 2025 and 2026, citing anticipated losses from XLS following its consolidation with Smartfren and costs related to merger integration. According to CIMB Securities, Axiata's EPS is expected to only exceed pre-merger levels by the financial year 2027 (FY27), as the group begins to realise the full benefits of synergies stemming from the merger. "Nevertheless, we have kept our 'Buy' rating with a 19 per cent lower target price (TP) of RM2.60 post earnings revision and lowering Edotco's enterprise value to earnings before interest, taxes, depreciation, and amortisation (EV/EBITDA) target multiple to 8 times from 10 times (-22 sen). "We see potential asset monetisation initiatives in the next 12 to 18 months as a re-rating catalyst," it said. CIMB Securities stated that based on an enterprise value of US$3.5 billion or RM15.1 billion, Edotco is reasonably valued at a financial year 2024 (FY24) EV/EBITDA multiple of 8.4 times. It said after accounting for a pro forma net debt of RM4.6 billion at end-FY24, which includes expected proceeds from the pending US$150 million sale of Edotco Myanmar (EMM), the estimated equity value comes to RM10.5 billion. "Thus, Axiata could receive RM6.6 billion in cash (72 sen per Axiata share) for its 63 per cent stake. If entirely used to repay debt, we estimate interest cost savings of RM218 million, which will largely offset the removal of Edotco's earnings contribution," it added. The firm said Axiata's ability to pay dividends per share (DPS) could increase to 12.3 sen in FY26, compared to its current estimate of 10.5 sen. This potential increase is mainly due to lower interest payments on Axiata's holding company (HoldCo) debt, which are expected to more than offset the loss of relatively small dividends from Edotco, estimated at RM32 million to RM83 million between FY25 and FY27. "In turn, this may result in Axiata raising its DPS from FY26, a year ahead of our expectations. Balance sheet-wise, HoldCo debt may fall from RM9.5 billion at end-FY24 to just RM1.4 billion by end-2025, with group net debt/EBITDA at 1.0 times. Alternatively, Axiata could also pay out part of the sale proceeds in the form of a special DPS," CIMB Securities said. The firm has updated its FY25-FY27 core net profit forecasts for Axiata based on the operating companies' 2024 results and recent mergers, including the Dialog-Airtel merger completed in June 2024 and the XLS merger in April 2025. It also factored in the structural shift in Indonesia, with Link Net's B2C business transferring to XL in the third quarter of 2024. "Post revisions, we now forecast Axiata's core net profit (from continuing and discontinuing operations) to decline 49 per cent year-on-year (YoY) to RM439 million in FY25 and then recover by 71 per cent YoY to RM750 million in FY26, albeit still remaining below the FY24 level (RM852 million). "We only expect Axiata's core net profit to climb above pre-XLS merger levels in FY27, with a further 68 per cent YoY growth to RM1.26 billion," CIMB Securities added.
New Straits Times
12-05-2025
- Business
- New Straits Times
Kerjaya Prospek's Johor win boosts order book to RM4.6bil
KUALA LUMPUR: Kerjaya Prospek Group Bhd's maiden project win in Johor has pushed its outstanding order book to RM4.6 billion, providing earnings visibility for the next three years. Kenanga Research is positive on this sixth contract job win for financial year 2025 (FY25), which is Kerjaya Prospek's first non-related party win for the year. "It has guided a 10 per cent profit after tax margin for this project. This win brings year-to-date contract wins to RM870.3 million, against our FY25 job replenishment assumption of RM1.8 billion. "This formed 48 per cent of our target and 54 per cent of management's target. Its current total outstanding order book stands at RM4.6 billion, which will keep them busy for the next three years," it said in a note. Kerjaya Prospek's subsidiary Kerjaya Prospek (M) Sdn Bhd has secured a RM162 million building contract in Johor Baru from Majestic Gen Sdn Bhd. The contract involves main building works for Gen Rise, a 47-storey transit-oriented serviced apartment development located near customs, immigration and quarantine and the Bukit Chagar rapid transit system. Additionally, Kerjaya Prospek has set a job replenishment target of RM1.6 billion for FY25, backed by a RM2 billion tender book for building jobs. In addition, together with its joint venture partner Samsung, the company is tendering for three data centre jobs worth RM3 billion with targeted outcomes by the third quarter of 2025. "Its related party company E&O plans to launch projects with building jobs worth RM2 billion in 2025. For its property development segment, its 55 per cent-owned Rivanis will sustain its construction and property earnings in the next seven years," it added. Kenanga Research maintained its 'Outperform' call on the stock with an unchanged target price of RM2.10.
The Sun
08-05-2025
- Business
- The Sun
Kerjaya Prospek, Majestic Gen in RM162m Johor deal
KUALA LUMPUR: Construction company Kerjaya Prospek Group Bhd's wholly owned subsidiary Kerjaya Prospek (M) Sdn Bhd has accepted a letter of award from Majestic Gen Sdn Bhd for a building contract worth RM162 million in Johor Bahru. The contract entails main building works for Gen Rise, a 47-storey transit-oriented serviced apartment development near the customs, immigration and quarantine (CIQ) and Bukit Chagar Rapid Transit System (RTS). The project comprises a single block with 732 units, nine levels of podium parking, and other supporting facilities. Construction, scheduled to commence on Aug 1, is expected to be completed within 36 months. Kerjaya Prospek CEO and executive director Tee Eng Tiong said the construction of Majestic Gen's is the company's maiden project in Johor and its first contract win in the state for 2025. 'Geographically, our focus remains on three growth regions namely Klang Valley, Penang and Johor, where we see strong demand and vibrant development activities continue to shape the future of urban living. 'With this latest RM162 million job, our year-to-date new contract wins have reached RM870.3 million, placing us well on track to achieve our RM1.6 billion target for the year,' he said in a statement. Tee said the total outstanding order book now stands at RM4.6 billion, providing healthy earnings visibility and a solid foundation for continued growth over the next four financial years. Majestic Gen CEO Datuk Hoo Kim See said the company had appointed Kerjaya Prospek, a reputable construction firm, to build Gen Rise – its first project in Johor. 'This is a truly momentous occasion for both companies as we aim to deliver quality and sustainable products to our esteemed buyers. 'We hope that this collaboration will further boost the market's confidence in our current and future developments with an estimated GDV of RM3.7 billion,' he said.
New Straits Times
08-05-2025
- New Straits Times
Cops seize 44kg of drugs worth RM4.6mil in Manjung raids
IPOH: Police have arrested four individuals, including a couple, and seized 44 kilogrammes (kg) of an assortment of drugs worth RM4.6 million in four separate raids in the Manjung district. Perak police chief Datuk Noor Hisam Nordin said they arrested the jobless couple, aged 28 and 24, in a house in Simpang Tiga, Sitiawan at about 7.30pm on Monday. "Upon inspection, police found methylenedioxymethamphetamine (MDMA) in the house and on a motorcycle parked in front of the house, weighing 15.6kg," he told a media conference at the Perak police headquarters here today. Noor Hisham said they then arrested a 50-year-old man at an apartment in Taman Sejati, Sitiawan, at 8.55 pm the same day and seized 127 grammes of ketamine and Erimin 5. He said the three suspects then led police to the discovery of 11.4kg of MDMA and 299 grammes of ketamine in a house used as a drug storage, where police also seized RM970 cash, at about 7.19am the next day. He said that all three suspects, who tested positive for Erimin 5, had prior police records related to crime and drugs. Noor Hisam said the syndicate is believed to have been active since March, and the drugs seized could have been used by 90,516 addicts. He added that the suspects have been remanded for a week until May 12 to assist in investigations under Section 39B of the Dangerous Drugs Act 1952. Meanwhile, Nor Hisam said police also arrested a 29-year-old delivery man at a hotel in Jalan Mohamad, near Sitiawan, at about 5am on Monday. "The suspect led a police team to a car parked in front of the hotel. Upon inspecting the car, police found 16 compressed blocks of dried leaves suspected to be cannabis weighing 16.6kg and worth an estimated RM51,500, as well as RM500 in cash. "The suspect tested positive for cannabis and also has prior criminal and drug-related records," he said, adding that the suspect has been remanded until May 11 to assist in their investigation. – BERNAMA
New Straits Times
08-05-2025
- Business
- New Straits Times
Kerjaya Prospek secures RM162mil Johor contract for 47-storey project
KUALA LUMPUR: Kerjaya Prospek Group Bhd's subsidiary Kerjaya Prospek (M) Sdn Bhd has secured a RM162 million building contract in Johor Baru from Majestic Gen Sdn Bhd, its first contract win in the state for 2025. The contract involves main building works for Gen Rise, a 47-storey transit-oriented serviced apartment development located near the customs, immigration and quarantine (CIQ) and Bukit Chagar rapid transit system (RTS). The project comprises a single block with 732 units, nine levels of podium parking and other supporting facilities, amongst others. Construction, scheduled to commence on Aug 1 this year, is expected to be completed within 36 months. Kerjaya chief executive officer and executive director Tee Eng Tiong said the company's focus remains on three growth regions, namely Klang Valley, Penang and Johor, where strong demand and vibrant development activities continue to shape the future of urban living. "With this latest job, our year-to-date new contract wins have reached RM870.3 million, placing us well on track to achieve our RM1.6 billion target for the year. "Total outstanding order book now stands at RM4.6 billion, providing healthy earnings visibility and solid foundation for continued growth over the next four financial years," he said in a statement. Majestic Gen chief executive officer Datuk Hoo Kim See expressed confidence that the collaboration will further strengthen market trust in the company's ongoing and upcoming developments, which have a combined estimated gross development value of RM3.7 billion.
