Seni Jaya Corporation Bhd - Within Expectations
Fri, 22-May-2026 07:29 am
by Tan Wai Wern • Apex Research

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SJC (9431)

Target Price (RM)

0.67

Recommendation

Buy

  • SJC’s 3QFY26 CNP came in at RM1.6m (-46.4% YoY, -62.7% QoQ), bringing 9MFY26 CNP to RM10.8m. Given that the Group’s earnings are seasonally stronger in 1H, the results were in line with our expectations, accounting for 81.7% of our full year forecast.

  • We remain positive on the Group’s outlook as improving advertiser demand, higher asset utilisation and the proposed expansion to strengthen its OOH market presence.

  • We maintain our BUY recommendation on SJC with an unchanged TP of RM0.67, based on unchanged 8.3x P/E multiple applied to FY27F EPS of 8.1 sen, along a three-star ESG rating.

Within Expectation. After excluding exceptional items which consist of fair value gains from investment in quoted shares, corporate exercise fees and non-operating income totalling RM1.6m, SJC reported a 3QFY26 CNP of RM1.6m, declining -46.4% YoY and -62.7% QoQ. This brings 9MFY26 CNP to RM10.8m, down -12.7% YoY and accounting for 81.7% of our full-year forecast. We deem the results in line with our estimates, as the Group’s earnings are typically weighted toward the first half of the FY, reflecting seasonal advertising trends following year-end campaign spending and budget utilisation.

 

YoY. SJC recorded a +17.9% YoY increase in revenue, driven by strong demand across all billboard segments, particularly its digital billboard network. Despite the stronger top-line performance, CNP declined -46.4% YoY, mainly due to the absence of a RM38,000 tax credit recognised in the corresponding quarter last year, which reversed to a RM1.6m tax expense in the current quarter. Nonetheless, the earnings decline was partially cushioned by a sharp increase in other income, which surged more than 13-fold to RM3.09m.

 

QoQ. SJC registered a -62.7% decline in CNP, driven largely by moderating advertising demand during the quarter following strong advertising demand in the previous quarter.

 

Outlook. We remain positive on the Group’s outlook following its strong results and proposed private placement exercise. Moving forward, we expect operations to remain resilient, supported by improving advertiser demand and higher asset utilisation across its OOH advertising network, alongside tailwinds from the Visit Malaysia 2026 campaign. The proposed exercise is expected to strengthen the Group’s geographical footprint and market presence within the OOH advertising segment by expanding its media network coverage across strategic high-traffic locations.

 

In addition, the acquisitions are expected to enhance profitability through the elimination of significant collaboration fees under the current revenue-sharing arrangement, where c.75% of revenue is returned as fees. Upon completion, the enlarged Group is projected to command an estimated 10% of the total addressable OOH advertising market. This increased scale is expected to strengthen its bargaining power with suppliers, contractors and media buyers, while supporting better commercial terms, improved cost efficiencies and stronger long-term earnings prospects.

 

Earnings Revision. We make no changes to our earnings forecast.

 

Valuation & Recommendation. We maintain our BUY recommendation on SJC with an unchanged TP of RM0.67, based on unchanged P/E multiple of 8.3x applied to FY27F EPS of 8.1 sen, along with a three-star ESG rating.

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