MIDF Research said it is positive on the construction sector, in line with the rollout of the Mass Rapid Transit 3 (MRT3) project, the impending rollout of other infrastructure projects and Gamuda’s strong foothold in Australia as it continues to clinch megaprojects there.

“We like the fact that it will continue to distribute dividends at pre-pandemic levels and we are positive on the potential sale of the group’s highway concessions, likely to be completed in August, which will see bumper dividends to shareholders,” it said in a note today.

Gamuda declared a second interim dividend of six sen per share, bringing its total dividend back to pre-pandemic levels of 12 sen per share, which is usually declared in the first and third quarters of its financial year.

MIDF Research has maintained its “buy” recommendation for the stock with a target price (TP) of RM4.02 per share.

Public Investment Bank Bhd has adjusted Gamuda’s FY22 earnings forecast upwards by 9.1% in view of stronger property contribution, particularly from Vietnam, and better contributions from the domestic construction segment with profitability improving due to relief contingencies for the MRT2 project.

“Our ‘outperform’ rating is maintained with a revised sum-of-parts derived TP of RM3.94 from RM4.09 previously,” it said.

CGS-CIMB Securities also retained its “add” call for Gamuda with a higher TP of RM4.35 versus RM4.25 previously.

It said the group’s outstanding order book at a new all-time high of RM12.4 billion was largely dominated by projects in Australia worth RM8.5 billion.

Overseas order books, including for Taiwan and Singapore, account for 86% of total outstanding orders.

The RM12.4 billion order book would provide earnings visibility for up to three to four years for the group, it said.

At 3.17pm, Gamuda jumped 15 sen, or 4.39%, to RM3.57 with 4.3 million shares transacted.