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- Gamuda’s secured projects include Segment 1 of the Penang Light Rail Transit (LRT) and data centre developments in Negeri Sembilan, which are expected to drive the company towards achieving its order book target of RM40 billion to RM45 billion this year.
KUALA LUMPUR (June 18): RHB Investment Bank estimated Gamuda Bhd's (KL:GAMUDA) core net profit could rise to between RM230 million and RM250 million for the third quarter ended April 30, 2025 (3QFY2025), the research house said in an earnings preview note.
This translates into a growth of between 4% and 13% in the third quarter from a year ago as it sees better progress of its involvement in Australia’s underground rail project Sydney Metro West.
Gamuda’s other secured projects, including Segment 1 of the Penang Light Rail Transit (LRT) and data centre developments in Negeri Sembilan, are expected to drive the company towards achieving its order book target of RM40 billion to RM45 billion this year.
While RHB Investment Bank maintained its “buy” recommendation on the stock, it raised its target price to RM5.64 from RM5.83 previously. This reflects an estimated upside potential of 18% and an expected yield of approximately 3% for the financial year 2026 (FY2026).
“We believe Gamuda deserves to trade at a premium to the Bursa Malaysia Construction Index, not just for its data centre construction capabilities, but also for its involvement in renewable energy projects in Australia,” the research house said, expecting Gamuda shares to trade at 19.7 times FY2026 price-to-earnings ratio.
The sum-of-parts target price was lowered, which includes an 8% environmental, social and governance (ESG) premium, reflecting Gamuda’s ESG rating of 3.4, above the national median score of 3.0.
A wide majority of analysts have “buy” calls on Gamuda shares, while only two have “hold” recommendations.
RHB Investment Bank said it sees no major roadblocks for Gamuda in meeting its order book target, even after a different consortium was selected as the preferred bidder for the Suburban Rail Loop Line Wide Package in Australia—a contract worth an estimated RM10 billion.
The research house highlighted that Gamuda still has about RM24 billion in contracts and has a strong chance to secure another RM12 billion worth of projects by the end of 2025.
Additionally, Gamuda could see potential near-term wins, including a RM3 billion water supply scheme in Sabah and Phase 2 of the Pearl Computing Malaysia data centre project in Elmina, estimated at RM2 billion, according to the firm.
Gamuda’s early involvement in renewable energy projects in Australia through early contractor involvement roles, which have higher conversion rates to full-scale contracts, could also amount to at least A$3 billion (RM8.28 billion) across three projects, according to the research house.
However, with less than two months left in the financial year, RHB Investment Bank revised the property developer's job replenishment assumption for the year downwards to RM20 billion from RM25 billion, while raising expectations for FY2026 to RM21 billion and FY2027 to RM17 billion.
The research house trimmed Gamuda’s earnings forecasts by 9.6% for FY2025, 2.6% for FY2026 and 1.4% for FY2027, due to more conservative billing assumptions for large-scale projects such as the Penang LRT.
At the midday break on Wednesday, shares of Gamuda were unchanged at RM4.80, giving it a market capitalisation of RM27.69 billion.
RHB Investment Bank added that faster-than-expected progress in infrastructure projects outside of the renewable and data centre segments, such as the Perak–Penang raw water transfer project, could act as catalysts for the share price.
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