MBSB Investment Bank Bhd (MBSB Research) has initiated coverage on Critical Holdings Bhd with a BUY recommendation and RM2.94 target price, implying 39.3% upside from RM2.11, alongside an expected 1.9% dividend yield and 41.2% total return. MBSB said the group is transitioning into a full-fledged engineering, procurement, construction and commissioning (EPCC) player, with its expanding project base providing room for stronger earnings growth.
The research house projects revenue to jump from RM271.8 million in FY2026 to RM758.5 million in FY2027 before reaching RM793.2 million in FY2028. Core profit is similarly forecast to rise from RM22.1 million to RM59 million and RM65.4 million over the same period.
MBSB said Critical’s maintenance and services segment remains a small contributor but has grown at a 19.8% compound annual growth rate between FY2020 and FY2025, providing recurring income alongside its project-based engineering business.
The segment offers preventive and scheduled maintenance, breakdown services and repairs for systems installed by Critical as well as third-party systems, with engagements typically lasting between three and 24 months.
As the group builds up its installed base through larger cleanroom, plantroom and data-centre projects, MBSB expects greater opportunities to convert completed projects into recurring maintenance, refurbishment and upgrade work, supporting the group’s transition towards a broader EPCC model.
As of 11.15 am, the stock price slipped 0.47% to RM2.10.
