Kerjaya Prospek Group Bhd - Within Expectations
Tue, 26-Aug-2025 09:16 am
by Team Coverage • Apex Research

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KERJAYA (7161)

Target Price (RM)

2.50

Recommendation

Buy

  • KERJAYA’s 2QFY25 record-high CNP came in within expectations at RM54.4m (+18.2% QoQ; +46.8% YoY), bringing 6MFY25 CNP to RM100.5m (+42.3% YoY), accounting for 50.8% and 51.8% of ours and consensus forecasts respectively. 

  • The QoQ improvement is mainly attributable to its two property development projects known as The Vue @ Monterez and Papyrus @ North Kiara.

  • The Group declared a second interim dividend of 3.0 sen in 2QFY25.

  • Maintain BUY recommendation with an unchanged TP of RM2.50, based on 15.0x P/E multiple applied to its FY26F EPS of 16.6 sen, along with a three-star ESG rating.

 

Results within expectations. KERJAYA’s 2QFY25 record-high CNP came in within expectations at RM54.4m (+18.2% QoQ; +46.8% YoY), bringing 6MFY25 CNP to RM100.5m (+42.3% YoY), accounting for 50.8% and 51.8% of ours and consensus forecasts respectively. The QoQ improvement is mainly attributable to its two property development projects known as The Vue @ Monterez and Papyrus @ North Kiara.

 

Dividends. The Group declared a second interim dividend of 3.0 sen for 2QFY25 (2QFY24: 2.5 sen), bringing YTD DPS to 6.0 sen (1HFY24: 5.0 sen).

 

YoY. CNP for 2QFY25 expanded 46.8% YoY to RM54.4m, underpinned by accelerated progress in Construction activities and Property Development. Revenue climbed 36.4% YoY to RM539.5m, supported by broad-based strength across all segments. The Construction division posted a 25.4% increase to RM470m, while the Property Development segment delivered a standout performance, surging 246.6% to RM68.8. Despite the topline momentum, CNP margins experienced slight compression, with the Construction and Property Development segments contracting by 2.5%-pts and 2.7%-pts, respectively, mainly attributable to higher tax expenses.

 

QoQ. CNP soared 18.2% on an 11.3% uplift in revenue, supported by higher contribution from its Property Development segment (PAT +43.8% QoQ) while its Construction segment moderated (PAT -13.7% QoQ). Property Development was supported by greater revenue recognition from two property development projects known as The Vue @ Monterez and Papyrus @ North Kiara. Consequently, overall CNP margin improved 0.3%-pts from 9.8% in 1QFY25 to 10.1% in 2QFY25.

 

Outlook. With proactive measures in place to mitigate headwinds such as Ringgit volatility, skilled labour shortages and escalating material costs, we anticipate the Group to deliver resilient performance, underpinned by its sizable construction order book of RM3.9b. Looking ahead, the Construction segment is expected to remain the primary growth driver, reinforcing topline expansion as the Group deepens its focus on core operations.

 

Earnings Revision. No change to our earnings forecast.

 

Valuation & Recommendation. We maintain our BUY recommendation on KERJAYA, with an unchanged TP of RM2.50, based on assigned 15.0x P/E multiple to its FY26F EPS of 16.6 sen, along with a three-star ESG rating.

 

Risks. Rising material costs, labour shortages, and high-rise office oversupply in the property sector.

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