KUALA LUMPUR (Oct 27): GDB Holdings Bhd (KL:GDB) rose on Tuesday to the highest in over four months after the builder bagged its biggest housing contract to date while Apex Securities raised its outlook.
The latest job for the construction of ParkCity Residences doubled the outstanding order book to RM2.05 billion, which will generate revenue through the next five years, the research house said, and raised its earnings forecasts by up to 23% for 2026-2028.
“We view this contract award positively,” Apex Securities, the sole house covering the stock, said and lifted its target price by seven sen to 67 sen while maintaining a 'buy' call.
GDB Holdings added three sen, or nearly 6%, to 54.5 sen, their highest since June 12. The stock has rallied 51% year-to-date and rebounded from recent lows when investors were worried over earnings as several projects neared completion.
On Monday, the company announced that it will be working on the project that involves two residential towers with 433 apartments. Construction is scheduled to begin on Nov 4 and to be completed by August 2031.
Apex Securities estimated that the contract could contribute about RM81.4 million in net profit over the construction period. The company could end 2026 with RM2 billion worth of new contracts after securing RM1.81 billion to-date, the house noted.
In July, the company also secured a RM439 million contract to construct Wolo Hotel & Residences in Mont Kiara.
However, “running two large high-rise jobs concurrently will test project management capacity and working capital while the long tenure exposes margins to building material and labour cost movements”, Apex Securities flagged.