KUALA LUMPUR, Nov 14 — Maybank IB Research has maintained a “buy” call on IJM Corporation Bhd with a target price of RM3.80 after the construction group bagged a RM378 million design and build contract from See Hoy Chan Sdn Bhd's unit, Damansara Uptown Retail Centre Sdn Bhd.
The construction of the 31-storey tower, with a net floor area of approximately 480,000 square feet, would commence this month and be completed in 39 months.
In a research note today, Maybank said IJM Corp's latest construction job win had positively lifted its outstanding order book to another record high of RM9.5 billion, further enhancing its medium-term earnings visibility.
“We make no change to our earnings forecast, having imputed job win potentials, and we maintain a 'buy' with an unchanged sum-of-parts-based target price (of RM3.80),” it said.
Meanwhile, Hong Leong Investment Bank Bhd Research (HLIB Research) also maintained a “buy” call on IJM Corp with a target price of RM3.97 following the construction job win.
“This is IJM Corp's third building contract for the year which brings year-to-date job wins to RM1.22 billion.
“We are bullish of its construction prospect,” said HLIB Research, adding that IJM Corp was after RM3 billion worth of new jobs for the financial year ending March 31, 2018, compared with conservative estimates of RM1.5 billion.
The research house said the company saw ample opportunity within the infra space and was eager to participate in mega projects such as the Light Rail Transit Line 3 (RM9 billion), Pan Borneo Sabah Highway (RM13 billion) and East Coast Rail Link (RM55 billion).