Investment Highlights

• We maintain our forecasts, SOP-based FV of RM3.76 (Exhibit 1) and BUY call, following the award of a RM392mil contract by HSBC Bank Malaysia Bhd to IJM for the design and construction of the HSBC building at Tun Razak Exchange (TRX), Kuala Lumpur.

• This is the third key construction job IJM has secured in FY18, boosting its YTD (FY March 2018) job wins to RM1.2bil and its outstanding construction order book to RM9.1bil.

• We are keeping our forecasts that assume a construction job replenishment target of RM3bil annually in FY18-20F, which is consistent with IJM's job wins of RM3bil in FY17.

• We are positive on the latest development. We continue to like IJM Corp as it is a good proxy to the booming local construction sector given its involvement in key infrastructure projects such as the West Coast Expressway, MRT2 and Kuantan Port Deepwater Terminal.

• Also, IJM is poised to garner a slice of action in the LRT3, Gemas – Johor Bahru double tracking and East Coast Rail Link, based on its forte and track record in rail projects (Seremban-Gemas double tracking, Delhi Metro, MRT1).

• IJM’s diverse business interests spanning a wide range of sectors which also include property, plantation, building materials, toll roads and ports, should help counter sectorspecific cyclical downturns, resulting in better earnings stability.

Source: AmInvest Research - 7 Nov 2017