KUALA LUMPUR (Sept 30): Gamuda Bhd’s share price rose as much as 13 sen or 4.3% to RM3.15 on Thursday morning after the builder reported on Wednesday a full-year rise in net profit, which beat market expectations.
In a statement to Bursa Malaysia, Gamuda said cumulative net profit rose to RM588.32 million for the financial year ended July 31, 2021 (FY21), from RM376.5 million a year earlier, although revenue was lower at RM3.52 billion versus RM3.66 billion.
For the fourth quarter ended July 31, 2021 (4QFY21), Gamuda said net profit stood at RM214.08 million, compared to a net loss of RM12.52 million a year ago, although revenue was lower at RM886.67 million versus RM926.52 million.
CGS-CIMB Securities Sdn Bhd analyst Sharizan Rosely wrote in a note on Thursday that Gamuda’s “overall FY21 results (core net profit) were 19% to 22% above our and the consensus full-year forecasts; the outperformance came from stronger-than-expected 4QFY21 earnings and lower tax rates".
MIDF Amanah Investment Bank Bhd analyst Ummar Fitri, meanwhile, wrote in a note on Thursday: “We deem the group's performance (normalised earnings) [to have] beaten our and consensus expectations, accounting for 111% and 119% of respective full-year estimates.”
Sharizan said CGS-CIMB raised its FY22 and FY23 earnings per share (EPS) forecasts by 3% and 7.5% respectively on recovery of Gamuda’s construction billings and lower tax rates. According to Gamuda, its FY21 net profit of RM588.32 million translated into EPS of 23.41 sen, compared with 15.13 sen a year earlier.
According to Sharizan, CGS-CIMB, however, lowered its target price (TP) for Gamuda to RM3.88 from RM4 while reiterating its "add" call for the stock.
MIDF's Ummar, on the other hand, said the research house maintained its "buy: recommendation for Gamuda but revised down its TP to RM3.63 from RM4.20.
"We maintain our [earnings] forecasts for FY22 and FY23 as we remain upbeat about prospects for the company,” he said.
On Bursa, Gamuda’s share price had pared gains at RM3.08 at 10.39am on Thursday, giving it a market value of about RM7.73 billion based on the company’s 2.51 billion issued shares.
Year to date (YTD), Gamuda’s share price has fallen to current levels from its closing price of RM3.73 on Jan 4, 2021.