Secures RM224.8mn of Building Works

INTA has been awarded a RM224.8mn contract by Tropicana Metropark Sdn Bhd, a subsidiary of Tropicana Corporation Bhd to carry out the construction works of a 38-storey serviced apartment in Subang Jaya, Selangor. This contract entails: -

(i) 30 floors of business serviced apartment

(ii) 8 floors of podium block.

The project shall commence on 2 May 2024 with a construction period of 34 months.

Our View

We are positive on the third contract win in FY24, lifting its year-to-date new job wins to RM743.4mn. This achievement represents 92.9% of our FY24 new job win assumption of RM800mn. With an estimated PBT margin of 5.4%, this latest project is expected to contribute net earnings of c.RM9.2mn throughout the construction period.

Following the job win, we estimate INTA’s total outstanding order book to be around RM1.6bn, equivalent to 2.5x FY23 revenue.

Impact

Considering the strong momentum in new order book replenishment, we have revised our FY24 order book replenishment assumption to RM1.2bn from RM800mn previously. Consequently, our FY24/25/26F earnings forecast have been revised higher by 1.8%/25.5%/25.0%, respectively.

Valuation

In tandem with the earnings revision, we toned up our target price to RM0.62 (from RM0.50), based on unchanged 11x CY25 earnings. We continue to like INTA for the following factors: (i) a direct beneficiary of the robust domestic property sector, (ii) strong earnings visibility backed by a resilient orderbook, and (iii) improving profitability. Maintain Buy call on the stock.

Source: TA Research - 26 Apr 2024