KUALA LUMPUR (Feb 27): UEM Edgenta Bhd (KL:EDGENTA) remains undervalued despite its strong fundamentals and international growth, said its managing director and chief executive officer Syahrunizam Samsudin, as he addressed questions regarding rumours of a potential privatisation.

He said that any decision on privatisation rests with the shareholders.

UEM Group Bhd, a wholly-owned unit of Khazanah Nasional Bhd, holds a 69.14% stake in the asset management and infrastructure solutions firm.

Syahrunizam added that the company's current market valuation does not fully reflect its growth trajectory and strong financial fundamentals.

“Well, first of all, it's a shareholder question. I'm not a shareholder. So I think that question will be something that the [UEM] group or Khazanah will be better placed to answer,” Syahrunizam said.

“But I think the idea here is that, privatisation or not, UEM Edgenta needs to be valued accordingly by the market. Whatever the market value says is a reflection of what we do, and I think we are very much under the radar for most investors or not even on the radar,” he added.

Syahrunizam, who took the helm in 2020, pointed to the company’s robust fundamentals, expanding international footprint and strong financial performance as key indicators that UEM Edgenta holds significant upside potential for shareholders.

“If you look at our fundamentals and the way we've grown internationally, as well as the quality of our revenue, profits and cash flows, there is a case for us to look at a more valuable outcome for shareholders,” he said.

The stock gained 6.5 sen or 9.22% to close at 77 sen on Thursday, valuing the company at RM640.4 million. Over the past year, its share price has dropped 23%.

For the financial year ended Dec 31, 2024 (FY2024), UEM Edgenta’s earnings per share came in at 6.22 sen, compared with 3.74 sen last year. 

It posted a 66.3% jump in net profit to RM51.75 million in FY2024 from RM31.11 million, while annual revenue grew 5.9% to RM3.05 billion, compared with RM2.88 billion previously.

The growth was primarily attributed to its expansion in international business through major contract renewals and new contract wins, along with enhanced operational efficiencies and strategic cost management initiatives implemented throughout the year.

Shares in UEM Edgenta have seen fluctuations over the past year, with speculation surrounding a potential privatisation bid by its UEM Group Bhd. Despite a slight rebound in late December 2024, the counter has barely recovered after touching a multi-year low of 62 sen in intra-day trading on November 5.

Read also:
UEM Edgenta eyes global growth with strong push in Singapore, Taiwan, Middle East