To date, KPG has won four job awards from Bukit Bintang City Centre Development totalling more than RM500 million between 2018 and 2023, with the latest job award on 30 Jan this year worth RM135.4 million for the construction of SWNK Houze, a 31- storey serviced apartment.
Other related jobs include Lucentia Residences, the Malaysia Grand Bazaar and SR Tower, said RHB Research (RHB) in the recent Small Cap ASEAN Research Report.
The management highlighted the usage of aluminium formworks and the self-climbing platform. The key attributes of aluminium formworks include a high re-usage value of 230-300 times versus conventional formwork of 50 times with a faster turnaround time of 7 days per floor.
Meanwhile, the self-climbing platform has a synchronised climbing mechanism covering 3.5 floors at one time, requiring a one-time installation at the low level and ensures better safety.
Upcoming jobs under BBCC may come from the remaining floors of a residential suite and office tower which may be in the range of RM50-100 million, in RHB’s view.
Also, there is an office tower and another serviced residences tower. On further scrutiny, the remaining office tower and the serviced residences tower share the same podium with the group’s ongoing projects, SWNK Houze and the ongoing serviced residences tower, thereby increasing KPG’s chances of winning the remaining jobs.
RHB continues to favour KPG for its lean cost measures facilitated by efficient construction methods as mentioned above, enabling consistent net margins of 10%.
“We do not discount the possibility of KPG being involved in overseas jobs as Samsung C&T has a presence in Singapore for the Cross Island Line and Indonesia, a power plant project. Furthermore, KPG is eyeing for less sophisticated industrial building jobs such as warehouses on its own,” said RHB.
RHB believes KPG winning the job award for the 80-storey BBCC signature tower will be a positive surprise as IJM Corp is seen as a frontrunner for the project after completing its first job, the RM1.2 billion LaLaport shopping mall.
Key risks identified by RHB include a slowdown in the property market, higher raw material cost pressures and lower-than-expected new contract wins.
