Latest news with #StrategicSonata
BusinessToday
12-08-2025
- Business
- BusinessToday
Looking Upward For IJM As Shah Alam Industrial Project Lifts Off
RHB Investment Bank Bhd (RHB Research) has maintained its BUY call on IJM Corp Bhd, raising the target price to RM3.73 from RM3.30, representing a 23% upside from its last traded price of RM3.04. The research house reported that the revision reflects an improved earnings visibility from ongoing industrial building projects in Shah Alam and a more optimistic outlook for global trade, alongside a 2% ESG premium in the valuation. The research house highlighted two major warehouse-related contracts in Shah Alam that are progressing well. The first, valued at RM654 million, was awarded in June 2023 by Global Vision Logistics for phase one of the Shah Alam International Logistics Hub (SAILH) in Section 26. The scope covers a four-storey warehouse, a multi-level car park, a single-storey office and ancillary facilities. Adjacent to the site, Maersk's 2.1 million sq ft storage and office complex reinforces the strategic importance of the area for logistics, a factor that RHB Research believes will aid IJM in securing additional contracts in the future. The second project, worth RM584 million, was awarded in June 2024 by Strategic Sonata for the construction of Plot A of a logistics hub in Section 15. This is located across from GDB Holdings' RM866 million Plot B development, also commissioned by Strategic Sonata. According to the house, site inspections in July revealed significant progress at the Plot A hub, with cranes dominating the skyline in what was described as a 'Valley of Cranes'. Both the SAILH and Plot A hub are estimated to be 60–80% complete, with handover expected in the first half of 2026. Industrial building contracts, excluding data centres, accounted for 26–28% of IJM's RM6.6 billion outstanding order book as of March 2025, based on RHB Research's projections. Demand for warehousing in Shah Alam is expected to remain firm, supported by its proximity to Port Klang, about a 30 to 40-minute drive, which allows operators to serve import and export needs while avoiding congestion near the port. The upward adjustment in IJM's target price also reflects a higher price-to-earnings multiple for its construction arm, now set at 18.5 times compared with 15 times previously, to capture the benefits of easing trade uncertainties and confirmed trade deals between the United States and several nations, including Malaysia, which has secured a reduced tariff rate of 19%. RHB Research retained its earnings forecasts but warned that a key downside risk lies in the potential delay or failure to secure new contracts. It added that any sizeable data centre win in the near term could lift the stock above current trading levels, given that IJM remains the most undervalued among its key peers on forecast FY2026 earnings.
The Star
11-08-2025
- Business
- The Star
Shah Alam warehouse projects expected to propel IJM earnings
PETALING JAYA: IJM Corp Bhd 's earnings momentum will continue to be underpinned by its outstanding order book as progress on its two ongoing warehouse-related jobs in Shah Alam remain 'quite commendable'. RHB Research said it took a look at the progress of IJM's two ongoing warehouse-related jobs in Shah Alam and was upbeat on the progress so far. 'The presence of Maersk's 2.1 million square-foot storage and office site in Section 26, Shah Alam, is a testament to the importance of the area in fulfilling logistics needs and this should help IJM secure new jobs within the area in the future,' the research house said in a report yesterday. The group's first job in Shah Alam, awarded in June 2023, is worth RM654mil and is for the design, execution and construction of phase one of the Shah Alam International Logistics Hub (SAILH), commissioned by Global Vision Logistics. Phase one of SAILH includes a four-storey warehouse complex, a four-storey multilevel parking facility and a single-storey office alongside ancillary buildings. The second warehouse-related job in Shah Alam is worth RM584mil, awarded in June 2024 by Strategic Sonata for the construction of Plot A of a logistics hub (Plot A hub) in Section 15. This project is situated across from GDB Holdings' RM866mil job for Plot B of the same logistics hub, also awarded by Strategic Sonata. RHB Research said progress has been quite commendable, especially for the Plot A hub. While the research house said it did not observe many 'high structures during our previous visit in March', progress had picked up in July, with many cranes being deployed, turning the area into the 'Valley of Cranes'. 'Based on our estimates, both projects – SAILH and Plot A Hub – are roughly 60% to 80% done, respectively, and should reach completion in the first half of 2026,' the research house said. RHB Research believes that any sizeable data centre job win in the near term would propel IJM above its current trading level (financial year 2026 forecast price-to-earnings ratio of 19.8 times), as it is currently the most undervalued among key peers. A key downside risk, however, is the failure to secure contracts in a timely manner. RHB Research has a 'buy' call on IJM Corp with a target price of RM3.73.
