[%TXhU%]
Research by HLIB
Buy - TP RM5.60

"On the right track"

SunCon reported 1HFY24 earnings of RM66.4m meeting our expectations. Billings from its key DC project has started and is on-track to accelerate in 2H. Guidance of higher margin DC projects is manifesting in the reported numbers. Tender opportunities are robust with tender book increasing to RM13.7bn even after stripping off ~RM6bn VN power plant project. We view potential slight delays in EPC formalisation as a negligible blip. Precast segment should continue to benefit from healthy HDB demand in SG and entry into DC supply space. Maintain BUY with unchanged TP of RM5.60.

Analyst:
Edwin Woo, CFA
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$KLSE-SUNCON
Research by HLIB
Buy - TP RM5.60

"On the right track"

SunCon reported 1HFY24 earnings of RM66.4m meeting our expectations. Billings from its key DC project has started and is on-track to accelerate in 2H. Guidance of higher margin DC projects is manifesting in the reported numbers. Tender opportunities are robust with tender book increasing to RM13.7bn even after stripping off ~RM6bn VN power plant project. We view potential slight delays in EPC formalisation as a negligible blip. Precast segment should continue to benefit from healthy HDB demand in SG and entry into DC supply space. Maintain BUY with unchanged TP of RM5.60.

Analyst:
Edwin Woo, CFA
ckwoo@hlib.hongleong.com.my

$SUNCON / 5263 (SUNWAY CONSTRUCTION GROUP BERHAD)