PETALING JAYA: Mercury Securities Sdn Bhd’s confidence in Kerjaya Prospek Group Bhd remains steadfast due to the group showing significant advancements in its construction work activities.
In a note today, the research house has maintained a “buy” call on the group, keeping its target price (TP) unchanged at RM1.46.
The TP is aligned with Kerjaya’s FY2023F earnings per share (EPS) of 10.8 sen and price-earnings (PE) ratio of 13.6 times, noted Mercury.
The research house said the group’s results met its expectations, accomplishing 46.5% and 44.7% of its full-year revenue and profit forecasts for financial year 2023 (FY2023).
“Kerjaya stands out due to its adept and efficient cost management practices, resulting in profit margins that surpass the industry average,” it said.
In the recent quarter, the company had secured three noteworthy contracts, which included a residential development contract valued at RM404.4 million from BCM Holdings.
The other two contracts are a RM24.7 million earthworks job for a proposed mixed development from Eastern & Oriental Express Sdn Bhd, and a RM21.3 million infrastructure works for the proposed STP2 Development in Penang from Persada Mentari Sdn Bhd.
These contract acquisitions contribute to the group’s year-to-date contract wins, which are now approaching a total of RM983.8 million, not far from its targeted FY2023 total order book win of RM1.2 billion.
“With a proven track record and under the adept leadership of chairman Tee Eng Ho, who brings over three decades of experience in civil and building construction, Kerjaya has strong prospects in the construction field while maintaining an accomplished management team,” said Mercury.
Notable projects in Kerjaya’s portfolio include the RM503 million Bloomsvale Old Klang Road and the RM710 million Astrum Ampang.
The company is presently engaged in 36 ongoing projects, with an order book valued at RM4.5 billion.
At the close of trade, Kerjaya Prospek’s share price dropped 1 sen or 0.83% to RM1.19, valuing the group at RM1.51 billion.