Sunway Construction

[winston]

not vested

Expanding empire in property and healthcare

SMCKL as the largest private hospital in SEA has the scale and infrastructure potential to become a regional medical tourism hub.

Over the next few years, by scaling up its international patient base, this could see its revenue per bed potentially increasing multi-fold, indicating lucrative upside pricing potential.

Its property segment is set to exceed FY24 launch target with earnings accelerating in 2H24 driven by Sunway V3 and Singapore projects.

We increase FY23/24/25 forecasts by +10.3%/15.8%/1.1% to account for higher property contribution.

Maintain BUY with a higher TP of RM5.45 (from RM5.15) based on SOP-valuation.

Source: HLIB

https://acrobat.adobe.com/id/urn:aaid:s ... 90b4722728

[winston]

not vested

SunCon prudently hopeful after strong showing

SunCon saw net profit climb 32.7% year-on-year (y-o-y) to RM46.5mil, as revenue also grew 28.5% to RM865.3mil.

Source: The Star

https://www.thestar.com.my/business/bus ... ng-showing

[winston]

not vested

3Q24: In-line

Positives priced in SCGB’s 3Q/9M24 earnings were in-line.

We make no change to our earnings forecasts and MYR3.70 TP, based on 21x PER (about +0.5SD of mean) on FY25E earnings.

While we like SCGB for its strong execution capability, we believe that its medium-term positives are priced in with the stock now trading at 25x FY25E PER; maintain SELL.

Source: Maybank

chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://mkefactsettd.maybank-ke.com/PDFS/420822.pdf

[winston]

not vested

3Q24: Hitting A Bumper; Prudent Progress Billing and Margins Recognition

Suncon’s 3Q24 earnings were below expectations, reflecting slower-than-expected progress billings of DC projects and conservative recognition of margins.

Despite still anticipating much stronger 2025 earnings premised on accelerated DC projects’ delivery and robust orderbook replenishment, 4Q24 earnings will likely only chart a marginal qoq improvement.

Valuations also appear fair at close to +1SD above mean based on 2025F earnings.

Maintain HOLD with a lower TP of RM4.54.

Source: UOBKH

chrome-extension://efaidnbmnnnibpcajpcglclefindmkaj/https://39646150.fs1.hubspotusercontent-na1.net/hubfs/39646150/Research/Sunway%20Construction%20(SCGB%20MK)%20241122.pdf?utm_medium=email&_hsenc=p2ANqtz-_SefJ12JDpJOhNcLuOEsolf93HQCgsohpOGxr-8ms68uXh2NpOlq3E4X-fbtCXxmdWcSsuEatKEot4mIzRyttqKqL5eA&_hsmi=335149550&utm_content=335149550&utm_source=hs_email

[winston]

not vested

Sunway Construction (SCGB MK) - Main Drag From Higher Tax
Date: 2024-11-22
Firm: PHILLIP CAPITAL
Price Target: 4.50

SunCon 9M24 core net profit of RM106m (+10% YoY) missed ours and consensus expectations

Sequential revenue grew on the back of higher project progress billings, but earnings dragged by lower margins and higher tax rate.

Maintain HOLD rating with unchanged target price at RM4.50

Source: Phillips

https://klse.i3investor.com/web/priceta ... arch/73398

[winston]

vested

SunCon set to sustain stellar growth in 2025

Outstanding order book stood at RM7.07bil as of September last year, with RM3.97bil secured so far in the financial year 2024 (FY24).

We anticipate the core net profit for 4Q24 at RM54.6mil to RM63.6mil (versus RM49.8mil in 4Q23 and RM44.1mil in 3Q24), excluding unexpected fluctuations in cost structure and one-time items.

“This projection is grounded on an estimated revenue of RM708.6mil to RM857.7mil in 4Q24, assuming both core net profit and revenue contribute 95%-100% to our full-year FY24 earnings estimates”.

Although there have been recent concerns surrounding data centres due to exports restrictions on AI (artificial intelligence) chips, SunCon’s management, in close communication with its clients, has reported no adverse feedback.

“Clients remain confident in their plans, and no delays are expected for secured contracts” .

“Based on the prices of steel bars quoted through channel checks in the market, the average price declined -4.66% month-on-month in December last year to RM2,443.25 per tonne.

“Additionally, the monthly average price for cement has remained unchanged for the 18th consecutive month since July 2023, holding steady at RM380 per tonne of bulk cement

Source: The Star

https://www.thestar.com.my/business/bus ... th-in-2025

[winston]

not vested

4Q24: A Real DC Play

Suncon’s 4Q24 earnings were within expectations, reflecting better progress billing from the construction segment, particularly from the RTS Link and DC projects.

In view of its upsized tenderbook pipeline and accelerated DC project deliveries, we are positive on Suncon’s robust earnings growth in 2025-26.

Expect awards of more largescale DC contracts in 2025.

Upgrade to BUY with a higher target price of RM4.66.

Source: UOBKH

https://research.uobkayhian.com/content ... e=hs_email

[winston]

SunCon eyes RM6bil order book this year

RM4.5bil to RM6bil new order win target for financial year 2025 (FY25) (FY24: RM4.2bil).

We estimate that SunCon will need to clinch half of this target by first half of 2025 to ensure there is earnings continuity in FY26, given its burn rate RM1.2bil to RM1.3bil per quarter and present order book of RM5.8bil.

SunCon is targeting RM2bil worth of projects from its parent company Sunway Bhd in FY25 giving it a ready pipeline of projects.

revenue contribution from internal projects awarded by Sunway has fallen to 25% to 39% for FY23 to FY24, from 33% to 40% for FY19 to FY22, given the DC project awards.

Source: The Star

https://www.thestar.com.my/business/bus ... -this-year

[winston]

not vested

Another Sunrise

Having ridden through the sector’s selldown, stemming from the US’ AI chip export restrictions earlier this year, Suncon continues to deliver commendable earnings growth and has guided rosy prospects for 2025-26.

More importantly, earlier concerns on the shifting paradigm within the local data centre industry have been allayed as most data centre tenders and projects are progressing without delays.

With this, coupled with robust orderbook replenishment and palatable valuations, we maintain our BUY rating and target price of RM5.05.

Source: UOBKH

https://research.uobkayhian.com/content ... e=hs_email

[winston]

SunCon posts stellar quarterly showing

Sunway Construction Group Bhd (SunCon) more than doubled its revenue and net profit in its first quarter (1Q25),

RM6.6bil order book

The group has completed one DC project and is managing five ongoing projects for major multinational clients.

For 1Q25, SunCon’s revenue more than doubled to RM1.4bil from RM604.8mil a year earlier.

Net profit also surged, rising over two-fold to RM75.72mil from RM32.4mil in 1Q24, translating to an earnings per share of 5.87 sen versus 2.51 sen previously.

Source: The Star

https://www.thestar.com.my/business/bus ... ly-showing