• Maintain BUY (TP: RM2.30). Kerjaya Prospek Group Berhad (Kerjaya) recorded a Core Net Profit of RM116.7mn for 9MFY24, representing a 20.9% YoY growth which we deem broadly inline, making up 68.4% of our estimate and 70.4% of the consensus forecast. Revenue rose by 27.7% YoY to RM1,237.4mn, compared to RM968.7mn in the prior year, driven by a 25.5% increase in the construction segment and an impressive 149.2% growth from ongoing property developments, particularly The Vue and Papyrus projects. The company declared a third interim DPS of 7.0sen, bringing YTD DPS to 12.0sen which is higher than FY23's total of 8.0sen. We anticipate a full-year DPS of 15.0sen for FY24, translating to a dividend yield of 6.0%. We reiterate our BUY call on Kerjaya, with higher SOPderived TP of RM2.30 (from RM2.26) which implies 12.6x FY25F P/E.

• Key Highlights. In 3Q24, both revenue and net profit posted QoQ growth, driven by improved construction activity coupled with higher contributions from the property segment. Kerjaya's outstanding orderbook remains robust at RM4.4bn, with 48% derived from related party transactions (RPT).

• Earnings Revision. We raise FY25-26 forecast to 14% and 6% respectively. The upward revision for FY25-26 reflect anticipated growth driven by new project launches, contributions from unbilled property sales, and the commencement of revenue recognition from upcoming large-scale developments.

• Outlook. We remain positive on Kerjaya’s growth outlook, particularly for FY25 and FY26, supported by new project launches in Andaman Island and Klang Valley, as well as c.RM200mn in unbilled sales from The Vue and Papyrus. Further upside is anticipated from the Aspen Project (Phase 1, GDV: RM1.5bn), which is expected to contribute meaningfully starting FY26, reinforcing earnings visibility. Nevertheless, cost pressures from higher minimum wages and EPF contributions will remain as key risks given that foreign workers constitute over 90% of Kerjaya’s construction workforce.

Source: BIMB Securities Research - 28 Nov 2024