Two thumbs up for Gamuda winning rail project in Perth
Researchers with Kenanga Investment Bank Bhd (Kenanga Research) are upbeat on Gamuda Bhd (Gamuda) as it has won the signalling project for the rail network in Perth, Australia in partnership with French rail transport giant Alstom.
“We estimate Gamuda’s share is worth circa A$700 million (RM2.1 billion), putting it one step closer to meeting its job win target of RM25 billion over two years,” it said in its analysis yesterday.
Gamuda’s Australian unit DT Infrastructure Pty Ltd (DTI), via AD Alliance, a joint venture with Alstom Transport Australia Pty Ltd, a unit of French rail transport giant Alstom, has won a high-capacity signalling project (upgrading of signalling and train control systems) for the rail network in Perth, Western Australia.
AD Alliance was one of the two shortlisted bidders in June 2023.
“We are positive on the latest development. This is Gamuda’s fifth major contract win in FY24, bringing its year-to-date contract wins to the RM13.3 billion to RM13.8 billion range against its job win target of RM25 billion over two years on FY24 and FY25.”
Kenanga Research said out of five contract wins, only Taiwan’s Kaohsiung MRT Yellow Line (worth RM3.03 billion) and Singapore’s MRT West Coast
Station and Tunnels (worth RM1.77 billion) are confirmed with contract value, while the civil work contracts for Upper Padas Hydroelectric Power Plant (estimated at RM2 billion), Penang LRT Mutiara Line
(estimated at RM4.6 billion to RM5 billion) and HCS project are still under negotiation.
The research firm thus maintained its target price of per share at RM6.20 with an outperform call.
“We continue to like Gamuda for being the front-runner for the tunnelling job for the MRT3; its ability to secure new jobs in overseas markets; its strong war chest after the disposal of its toll highways; its strong earnings
visibility underpinned by a record outstanding order book of RM24.1 billion (excluding Upper Padas Hydro, Penang LRT and HCS projects); and its inroads into the renewable energy space.”