KJTS to build on stellar 1H performance

PETALING JAYA: After tripling its net profit in the first half of this year (1H25), KJTS Group Bhd is expected to experience better quarters ahead, analysts say.

CIMB Research said the integrated building support services group also guided that its consultancy income is expected to increase.

This would be supported by a growing pipeline of contracts.

“At its results briefing, KJTS revealed that the other income of RM2.1mil (up 71.1% year-on-year, 300.4% quarter-on-quarter) recorded in the second quarter (2Q25) was primarily driven by consultancy services under the cooling energy segment.

“These services comprise evaluation, feasibility studies, and assessment work for partners to assess potential projects and acquisition targets,” the research house said.

By segment, the cooling-energy segment remained the largest contributor in 1H25, accounting for 56.5% of group revenue, followed by cleaning services and facilities management.

Recurring revenue accounted for 58.7% of 1H25 revenue, while non-recurring contributions increased to 41.3%, largely driven by cooling-energy-related engineering, procurement, construction and commissioning project recognition.

As of 2Q25, KJTS’ order book stood at RM482mil, with contracts extending until 2037.

Meanwhile, CIMB Research said the group’s management highlighted that it is a key beneficiary of the recent electricity tariff hike. The hike has spurred demand for outsourced cooling-energy solutions as customers seek cost-efficient and sustainable alternatives.

KJTS currently manages nine cooling-energy management services sites, with another nine projects underway including new contracts from hotel operator Centara and KIP-REIT.

On its joint venture with investment company Stonepeak, where KJTS has a 10% stake, CIMB Research said several potential cooling energy projects have been submitted for the joint-venture’s evaluation.

Should Stonepeak decline, KJTS retains the right to execute them independently.

“Supported by government initiatives under the National Energy Transition Roadmap and decarbonisation efforts, demand for energy-efficient cooling solutions is expected to rise.

“With no major surprises from its 1H25 results, we maintain our earnings per share forecasts for this year to 2028, ‘buy’ rating, and target price of RM1.85 for KJTS,” the research house said.