AME Elite to sustain growth trajectory on strong sales

PETALING JAYA: AME Elite Consortium Bhd looks set to sustain its growth trajectory as strong property sales and construction orderbook underpin earnings visibility in the coming quarters, analysts say.

The integrated industrial property development, construction, engineering services and property management group remains on track to meet its RM400mil sales target for its financial year ending March 31, 2026 (FY26), with foreign direct investment (FDI) inflows into Johor and Penang continuing to support demand for its industrial property developments.

Phillip Capital Research highlighted that AME Elite’s year-to-date sales of RM110.5mil, or 28% of the FY26 sales target, position the group firmly on course to achieve its annual target.

Optimistic on the company’s prospects, Phillip Capital Research maintained its “buy” call on AME Elite, with an unchanged target price of RM2.

“We roll forward our valuation horizon to FY27 with our sum of parts-derived target price remaining unchanged, with a decline in property net asset value offset by higher construction and engineering contributions,” the research house added.

It also pointed to the group’s presence in strategic industrial zones, noting: “We continue to like AME Elite for its presence in high demand FDI hotspots in Johor and Penang.”

However, it cautioned that there are key risks to its call, and that includes higher raw-material prices, and weaker-than-expected property sales.

Sequentially, AME Elite’s first quarter revenue for FY26 (1Q26) rose 62% quarter-on-quarter to RM187.5mil, supported by stronger contributions from property development and construction. Property-development revenue surged 91% on the back of improved progress billings, while construction revenue climbed 24%.

Still, earnings before interest, tax, depreciation and amortisation margins narrowed by 21 percentage points due to the absence of industrial property sales to AME real estate investment trust during the quarter, resulting in a lower core net profit of RM32mil, down 3% from the preceding quarter.

New sales of RM110.5mil were recorded in the first quarter, while sequential earnings were anchored by an unbilled sales figure of RM608mil and a construction orderbook of RM255.9mil.

Year-on-year, the group’s revenue improved 32% in 1Q26, buoyed by better progress across ongoing industrial property developments and construction projects, which offset weaker contributions from the engineering segment.

Ebitda margin rose by six percentage points to 25.7%, supported by operating leverage from the property and construction arms. This led to a 120% jump in core net profit to RM32mil.

It noted that the results were broadly within expectations, accounting for 17% of its full-year forecast and 19% of consensus.