Kerjaya Prospek Group Bhd - Within Expectations, Stronger Margins
Fri, 27-Feb-2026 08:33 am
by Tan Wai Wern • Apex Research

Counter

KERJAYA (7161)

Target Price (RM)

2.71

Recommendation

Hold

  • KERJAYA registered 4QFY25 CNP of RM66.7m (+53.7% YoY, +16.2% QoQ), bringing its FY25’s sum to RM224.7m. This is slightly above ours (106%) and in line with consensus (105%) expectations.

  • We expect KERJAYA to deliver a resilient performance despite macro headwinds, supported by a sizeable RM4.4bn outstanding order book, implying a book-to-bill ratio of 1.8x.

  • Lifted FY26F/FY27F earnings forecast slightly by +1.6%/+3.2% to reflect the Group’s ability to deliver strong, consistent margins.

  • Maintain HOLD recommendation on KERJAYA with a higher TP of RM2.71 (from RM2.67), based on unchanged PE of 15.0x FY26F EPS of 18.1 sen, along with a three-star ESG rating.

 

Broadly In Line. KERJAYA registered 4QFY25 core net profit (CNP) of RM66.7m (+53.7% YoY, +16.2% QoQ), bringing its FY25’s sum to RM224.7m. This is slightly above ours (106%) and in line with consensus (105%) expectations. The positive deviation was a result of better-than-expected net margins which improved 268bps YoY but registered a slight decline of 21bps QoQ.

 

YoY/YTD. CNP recorded strong earnings momentum, with growth of +53.7% YoY and +40.3% YTD, driven by improved construction progress and net margin expansion of 268bps YoY / 126bps YTD. This was underpinned by disciplined project execution and a growing order book which rose from RM4.0bn at end-FY24 to RM4.4bn currently.

 

QoQ. In line with the +18.6% increase in revenue, CNP rose +16.2%. Growth was driven primarily by stronger contributions from the property development segment, where revenue and CNP increased +31.4% and +22.4%, respectively. This was underpinned by healthy progress at The Vue @ Monterez and Papyrus @ North Kiara, which have achieved take-up rates of 99% and 91%. Unbilled sales remain robust at RM82m for The Vue @ Monterez and RM120m for Papyrus @ North Kiara, supporting total unbilled sales of RM202m and underpinning earnings momentum into FY26.

 

Dividends. The Group declared a fourth interim dividend of 3.5 sen per share (ex-date: 12 March), lifting YTD DPS to 12.5 sen (FY24:15 sen). Excluding the 4.0 sen special dividend declared in 3QFY24, FY25 dividends would reflect a 1.5 sen YoY increase. 

 

Outlook. We expect KERJAYA to deliver a resilient performance despite macro headwinds, supported by a sizeable RM4.4bn outstanding order book, implying a book-to-bill ratio of 1.8x. Looking ahead, orderbook replenishment remains well supported by a visible pipeline from related parties, KPPB and E&O. Assuming combined annual GDV launches of RM3.0bn and a 50% construction-to-GDV conversion, KERJAYA is well-positioned to secure c.RM1.5bn of related-party contracts, providing a solid floor for order book growth. Beyond this, the Group has targeted a more proactive strategy to secure a total RM2.0bn worth of new jobs in FY26, with an emphasis on third-party contracts to rebalance its mix toward 35% external and 65% internal jobs. This is complemented by a broader pursuit of infrastructure-related works, including industrial projects, data centres and commercial developments. Taken together, the RM4.4bn current order book and an estimated RM2.0bn tender book provides strong earnings visibility going forward.

 

Earnings Revision. We lift our FY26F/FY27F earnings forecast slightly by +1.6%/+3.2% to reflect the Group’s ability to deliver strong, consistent margins.

 

Valuation & Recommendation. We maintain our HOLD recommendation on KERJAYA with a higher TP of RM2.71 (from RM2.67), based on unchanged PE of 15.0x FY26F EPS of 18.1 sen, along with a three-star ESG rating.

 

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

Read more details in:

Disclaimer

The report is for internal and private circulation only and shall not be reproduced either in part or otherwise without the prior written consent of Apex Securities Berhad. The opinions and information contained herein are based on available data believed to be reliable. It is not to be construed as an offer, invitation or solicitation to buy or sell the securities covered by this report.

Opinions, estimates and projections in this report constitute the current judgment of the author. They do not necessarily reflect the opinion of Apex Securities Berhad and are subject to change without notice. Apex Securities Berhad has no obligation to update, modify or amend this report or to otherwise notify a reader thereof in the event that any matter stated herein, or any opinion, projection, forecast or estimate set forth herein, changes or subsequently becomes inaccurate.

Apex Securities Berhad does not warrant the accuracy of anything stated herein in any manner whatsoever and no reliance upon such statement by anyone shall give rise to any claim whatsoever against Apex Securities Berhad. Apex Securities Berhad may from time to time have an interest in the company mentioned by this report. This report may not be reproduced, copied or circulated without the prior written approval of Apex Securities Berhad.

Market Mover
Settlement Rates
Currency Buy Rates (RM) Sell Rates (RM)
USD 3.873662 3.904007
EUR 4.585195 4.588916
CNY 0.568471 0.568935
HKD 0.495355 0.498755
SGD 3.066257 3.087192