KUALA LUMPUR (July 31): UUE Holdings Bhd (KL:UUE) is set for record earnings after a better-than-expected quarter, as the underground utilities engineering company gets busier in Singapore.
Income from jobs in Singapore is expected to pick up over the coming quarters with all 10 teams fully deployed in Singapore since June compared to six teams at the end of May, Hong Leong Investment Bank said in a post-results note on Friday.
“We believe UUE is entering an earnings inflection point” in the current financial year ending Feb 28, 2027 (FY2027), the research house said.
Hong Leong Investment maintained its ‘buy’ call while raising its target price by 11 sen to 85 sen.
Shares of UUE were unchanged on Friday at 54.5 sen on Friday. The stock has bounced off this year’s lows in April at the height of the Iran war fears.
Analysts remain largely bullish with three ‘buy’, one ‘hold’, and no ‘sell’ calls. The consensus is looking at upside towards 67 sen in the next 12 months, based on the average target prices of the four research houses tracked by Bloomberg.
For Public Investment Bank, however, there is now limited upside to UUE’s stock price following the recent rally, and downgraded its rating to ‘hold’ post-results. Further, earnings recognition from Singapore is expected to remain “gradual” in the coming quarters, the research house said.
Revenue contribution from Singapore accounted for only 16% of total revenue despite the market making up 33% of the value of outstanding jobs on hand, suggesting “that the earlier work permit and mobilisation constraints have yet to be fully resolved,” the house noted.
“While the improved gross margin supported the quarter’s earnings, we are cautious to assume that this represents a sustainable new run-rate until there is clearer evidence of faster revenue conversion,” Public Investment added.
On Thursday, UUE reported a fivefold jump in net profit to RM9 million for the quarter ended May 31, 2026 (1QFY2027), boosted by higher-margin jobs in Singapore. Revenue for the quarter was 89% higher year-on-year.