KUALA LUMPUR (March 31): Kawan Renergy Bhd (KL:KENERGY) is seeing further slowdown in new contract wins that will drag on earnings in the near term, Public Investment Bank warned.
Earnings reported for the three months ended Jan 31, 2026 (1QFY2026) accounted for just 16% of the consensus’ full-year forecast, and with its order book falling below RM100 million, the amount of jobs on hand is insufficient to sustain a stable earnings trajectory, the research house flagged.
“The continued slowdown in order book replenishment is a key concern, as it raises execution risk and weakens earnings visibility heading into FY2026, particularly given the project-based revenue model,” the house said.
Public Investment, one of only two research houses with regular coverage of Kawan Renergy, said it is keeping its 'outperform' call with a target price of 54 sen, citing longer-term upside from its engineering capabilities and renewable energy exposure.
Kawan Renergy stayed in a tight range on Tuesday post-results, and was last trading at 42.5 sen after 813,000 shares changed hands. The stock, however, has lost nearly one-third of its market value year-to-date to just RM234 million.
The falling order book “implies a thinner pipeline of projects available for near-term conversion,” Public Investment said.
“Without meaningful contract wins to rebuild the order book, revenue recognition is likely to remain uneven, increasing the risk of earnings volatility over the coming quarters,” the research house added.