Mercury Securities has initiated coverage on Adnex Group Berhad with a “SUBSCRIBE” recommendation, setting a fair value (FV) of RM0.250. This represents a potential 25% upside from the group’s initial public offering (IPO) price of RM0.20.
The research house’s valuation is based on a target price-to-earnings (P/E) multiple of 8.6x applied to the group’s projected FY26 earnings per share (EPS) of 2.89 sen.
Adnex, a turnkey interior fit-out specialist with over 20 years of experience, is positioned as a primary beneficiary of the “flight to quality” trend in the Malaysian office market. As multinational corporations (MNCs) upgrade to Grade A and Green-certified offices, demand for high-tier, sophisticated fit-out services is surging.
To mitigate the cyclical nature of the corporate office and F&B sectors, Adnex is pivoting into “recession-resistant” industries. The group has already secured pre-qualification for major healthcare and private education providers, capturing stable institutional CAPEX.
The target P/E of 8.6x includes a 30% discount to historical peer averages, accounting for Adnex’s smaller market capitalization (estimated at RM100 million upon listing) and its current focus on the domestic corporate segment rather than diversified residential or overseas markets.
Adnex Group is scheduled to debut on the ACE Market of Bursa Malaysia on March 17, 2026. The public issue portion of its IPO remains open for application until March 5, 2026.
