IJM CORP BHD

IJM Corp, via its wholly-owned subsidiary IJM Construction Sdn Bhd, has secured the underground package of the Light Rail Transit Line 3 (LRT 3) from Bandar Utama to Johan Setia for a contract sum of RM1.12bil from Prasarana Malaysia Bhd.

Year-to-date, the group’s job replenishment rate is better than expected.

With the new job in the bag, the group’s value of total jobs secured is raised to about RM4bil vis-à-vis PublicInvest Research’s assumption of RM3bil for FY18.

That said, earnings forecasts are kept unchanged for now as the job is clinched nearing the end of the financial year, hence the impact to the research house’s earnings forecasts is not meaningful.

The completion period of the project is 31 months, and assuming 10% profit before tax margin, the contract is expected to contribute an estimated RM85mil during the construction period.

The new job, among others, involves design, construction and completion of an underground tunnel, stations, ancillary buildings and other associated works of the LRT3.

With this new job, the group’s construction order book moved higher to another record high of RM10.4bil.

Going forward, among the new jobs eyed include the East Coast Rail Link (ECRL) project, KL-Singapore high-speed rail and internal jobs, especially from The Light City integrated project (part of Phase 2 of The Light Waterfront Penang) which is estimated to have construction works worth RM1.5bil to RM2bil.