Gadang earnings visibility intact with latest job win

PETALING JAYA: Gadang Holdings Bhd’s engineering, procurement, construction and commissioning (EPCC) new contract win is expected to boost the group’s current outstanding order book to about RM903.5mil, says TA Research.

This is after factoring in an assumed RM80mil order book burn rate in the first quarter of financial year 2026 (1Q26).

It also represents 2.8 times of its financial year 2026 construction revenue forecast, providing healthy earnings visibility, said the research house in a note to clients.

The Gadang-JS Solar Consortium, comprising Gadang’s wholly-owned subsidiary Gadang Engineering (M) Sdn Bhd (51% stake) and JS Solar Sdn Bhd (49% stake), had recently secured an EPCC contract worth RM52mil from Tenaga Aspirasi Sdn Bhd for the development of a 15MWac large-scale solar photovoltaic (LSSPV) power plant in Tawau, Sabah.

The project is scheduled for completion within 14 months, by the fourth quarter of 2026.

TA Research said Gadang’s order-book replenishment year-to-date had reached RM144.5mil, accounting for 48.2% of its full-year assumption of RM300mil.

“We believe Gadang remains on track to achieve the balance in the coming quarters, underpinned by a robust tender pipeline of about RM3bil, spanning infrastructure, rail-related works and data centre projects,” it said.

Assuming a project net margin of around 5%, the research house estimated that the EPCC contract would contribute about RM1.3mil in effective net profit over its contract horizon.

Besides, this EPCC award marks the Gadang-JS Solar Consortium’s maiden win in the LSSPV space.

“We believe this provides a strategic entry point into the renewable energy construction space, where Gadang can leverage on its execution track record alongside its partner, JS Solar,” it added.