PETALING JAYA: Binastra Corp Bhd’s earnings are on track for a record-breaking year in the financial year 2025 (FY25), says Phillip Capital Research.
The research house said the construction firm’s latest outstanding order book which stands at RM3.3bil, has more than doubled following the RM2.5bil new contracts secured year-to-date, and this is expected to fuel earnings growth. Binastra is expected to see a year-on-year (y-o-y) earnings growth of 112% in FY25.
“Binastra reported a strong set of results, with revenue and net profit reaching a record high. Revenue for the second quarter of FY25 (2Q25) increased 29% quarter-on-quarter (q-o-q) to RM231mil, driven by better recognition from ongoing projects and the commencement of five new projects.
“The 2Q25 core net profit rose 26% q-o-q on the back of earnings before interest, taxes, depreciation and amortisation (Ebitda) margin improvement, but partly offset by higher depreciation and interest costs,” it said in a recent report.
Binastra’s core earnings for the six-month period of FY25 (6M25) came in at RM41mil (up 187% y-o-y) on the back of higher revenue of RM411mil (up by 170% y-o-y) attributable to improved progress recognition, with the order book more than doubling to RM3.3bil from RM1.5bil as of end 2Q24.
“The Ebitda margin improved one percentage point y-o-y to 14.1% as a result of stronger operating leverage. Overall, the 6M25 results were within both our and consensus estimates, representing 47% of both full-year forecasts,” Phillip Capital Research said
It reiterated a “buy” call on Binastra with an unchanged target price of RM2.15, based on a target 18 times multiple on FY26 estimated earnings per share.
“We like Binastra for its strong competitive advantage as a preferred contractor with key clients and superior profit margins. Key downside risks include slower-than-expected order book replenishment, unforeseen project delays and project margin cost pressure,” it said.
