Cost pressures out, DCs in

Research evidence excerpt

Cost pressures out, DCs in

Macquarie Equity Research Gamuda

Forecasts and Valuations

What are our earnings forecasts all things considered?

• FY26: We maintain our flat earnings forecast, in line with mgmt expectations.

• FY27: Inflection point is to start in FY27, driven by contribution from construction where

we expect a ramp-up from MY projects in particular. DCs also look to be in a sweet spot

with new wins recognised while benefitting with contributions from more mature projects.

• FY28: We see further ramp-up of MY infrastructure projects along with further reclamation

activities for Silicon Island, although this is slightly offset by lower YoY contributions from

DCs with those won before FY26 expecting to have been completed prior to FY28 and

a slight lull in activity anticipated before campus 2 DCs are awarded. With the ramp-up

in property sales for FY27E and FY28E, we see this translate to property contribution

increasing in FY28.

• Note overseas property contributions from AU and UK provide support to lumpy earnings

support with recognition upon project completions under build-to-sell arrangements.

• Against previous/BBG cons forecasts, key changes come from revising down our property

sales numbers with SG and VN launches to be ramped up more gradually. This explains

the lower growth in FY28 group NPAT and the increased conservatism vs BBG consensus

estimates in FY28. We believe such expectations on property launches to be in line with the

more measured approach by mgmt with its launches. This is partially offset by increasing

contribution from our expectations of DC and CRESS wins.

• Against mgmt revenue targets, our estimates imply that mgmt is one year behind its

original targets. Key culprit is due to delays in MY project wins last year, resulting in mgmt