GDB Holdings Bhd - Above Expectations
Fri, 22-May-2026 08:23 am
by Daryl Hon • Apex Research

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GDB (0198)

Target Price (RM)

0.57

Recommendation

Buy

  • GDB’s 1QFY26 CNP came in at RM21.5m (-41.1% QoQ, +8.6% YoY) after adjusting for for a RM0.1m gain on disposal of PPE. The results came above expectations, accounting for 35% of our full-year estimates. 

  • GDB’s orderbook now stands at c.RM620m, providing earnings visibility until FY29.

  • The Group’s tenderbook is estimated at c.RM3.1bn, with RM2.6bn of additional bids planned for 2Q 2026.

  • Maintain BUY recommendation with a higher TP of RM0.57 (from RM0.48), based on a higher target P/E multiple of 9.5x (from 8.0x) applied to rolled-forward FY27F EPS of 5.9 sen. 

Results above expectations. After adjusting for a RM0.1m gain on disposal of PPE, GDB’s 1QFY26 CNP came in at RM21.5m (-41.1% QoQ, +8.6% YoY). The results came above expectations, accounting for 35% of our full-year estimates. 

 

Dividend. The Group declared a first interim dividend of 0.7 sen (ex-date: 8 Jun 2026).

 

YoY. 1QFY26 CNP rose 8.6%, in line with the 15.7% increase in revenue driven by higher work progress and contributions from its key projects, namely the KL International Hospital in Bukit Jalil, the Logistic Hub Plot B project in Shah Alam and the Metrohub 4 Logistic Hub project in Klang and road development works at Sarawak.

 

QoQ. CNP fell 41.1% due to lower revenue recognition in 1QFY26, as revenue declined 15.2% following the peak revenue recognition phase in the preceeding quarter for ongoing projects, namely the KL International Hospital (87% completed), the Logistic Hub Plot B project in Shah Alam (87% completed) and the Metrohub 4 Logistic Hub project in Klang (95% completed), all of which are slated for completion in CY26.

 

Outlook. GDB’s orderbook now stands at c.RM620m, with its ongoing projects expected to provide earnings visibility through FY29. Meanwhile, its tenderbook remains healthy at c.RM3.1bn, with the Group preparing c.RM2.6bn worth of bids for submission by Q2 2026 across the warehouse, residential, commercial and mixed-use segments. Following its recent entry into the infrastructure space, we also expect additional infrastructure-related tender opportunities in East Malaysia to further support job replenishment and keep the Group busy over the medium term. As such, we raise our annual orderbook replenishment assumption to RM900m from our previously conservative assumption of RM550m.

 

Earnings Revision. Following the earnings beat, we raise our FY26F-27F CNP forecasts by 13% and 57%, respectively, after increasing our annual orderbook replenishment assumption to RM900m from RM550m previously. We also introduce FY28F CNP of RM54.8m.

 

Valuation and Recommendation. We maintain our BUY recommendation with a higher TP of RM0.57 (from RM0.48), based on a higher target P/E multiple of 9.5x (from 8.0x) applied to rolled-forward FY27F EPS of 5.9 sen. The assigned multiple is in line with the weighted average forward P/E of its peers. We remain positive on GDB’s prospects, underpinned by (i) its RM620m orderbook providing earnings visibility until FY29, (ii) a sizeable tenderbook expected to reach c.RM6bn by Q2 2026, and (iii)its latest venture into infrastructure and property development.

 

Risks. Rising material prices, failure to secure new contracts and risk of Liquidated Ascertained Damages (LAD).

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