RHB Investment Bank Bhd (RHB Research) has initiated coverage on Kee Ming Group Bhd with a fair value of 52 sen, ahead of the group’s debut on the ACE Market of Bursa Malaysia on Feb 12.
According to an IPO note from the research house, the valuation is based on 11 times FY27F prices-to-earnings (P/E), placing the electrical and mechanical engineering services player at a discount to large-cap construction peers.
It was reported that Kee Ming seeks to raise RM25.3 million from its IPO to bolster working capital and pursue business expansion.
RHB Research expects strong top-line momentum, projecting a 32% revenue CAGR between FY25-28F, anchored by Kee Ming’s deep presence in Perak, which accounted for 44.6% of 6MFY25 revenue.
On the earnings front, the research house forecasts profit to rise at a 31% CAGR from RM8.2 million in FY25 to RM18.4 million in FY28F, with industrial parks in Perak such as Lumut Maritime Industrial City, Kerian Integrated Green Industrial Park and Silver Valley Technology Park set to be key growth drivers.
“Additionally, Malaysia’s renewable energy push and growing data centre investments may add further lift,” it said.
Meanwhile, RHB Research highlighted that as of Dec 31, 2025, Kee Ming’s orderbook stood at RM176.1 million across 64 projects.
With a RM760 million tenderbook in hand, RHB Research pencils in a 15% success rate, translating to RM110 million in potential FY27 job wins and RM140 million in FY28 amid improving industrial demand. Industrial contracts also command healthier margins of 24%-27% compared to around 20% for residential.
Peer comparisons include Gamuda, IJM Corp, Sunway Construction, Kerjaya Prospek and Binastra Corp, which trade at an average 19.6 times forward P/E. RHB Research’s lower multiple reflects Kee Ming’s smaller RM123.5 million indicative market cap versus large-cap contractors.
Some of the downside risks for the group include geographic concentration in Perak/Penang, slow orderbook replenishment and cost overruns on fixed-price projects.
