Kerjaya Prospek Group (KPGB) was appointed by its related-party, Eastern & Oriental (E&O), to build 360 units of landed housing in Elmina West, Shah Alam for RM256.4m. This job marks the Group's first job win of the year, accounting for 12.8% of our FY25 job replenishment target of RM2.0bn. With this new job, the Group's outstanding orderbook increased by 6.5% to RM4.2bn. All told, we keep our forecasts unchanged as this forms part of our FY25 orderbook replenishment assumption. Based on our estimation, this job is expected to contribute 5-6% per annum on average to the Group's earnings during the 26 months contract period, assuming low-teen margins. We maintain our Neutral call on KPGB with an unchanged SOTP-based TP of RM2.00.

• Job scope of new job at Elmina West. The project involves the construction of 360 units of 3-storey terrace houses, alongside a clubhouse, TNB substation, landscaping and other related infrastructure. This project will be delivered in three phases, with construction set to begin on 20 Jan 2025 and completion targeted by 1QFY27 (within 26 months).
• Construction orderbook healthy at RM4.2bn. The Group's current outstanding orderbook increased by 6.5% to RM4.2bn after accounting for this job win, providing earnings visibility for the next 2-3 years. Our estimates indicate that this project will contribute about RM11.8m per annum on average from FY25-FY27F, assuming a low-teen profit margins. No changes made to our earnings estimates as this makes up part of our FY25 orderbook replenishment assumption of RM2.0bn.

Source: PublicInvest Research - 7 Jan 2025