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PETALING JAYA (March 9) Gamuda Bhd shares fell to an 11-month low on Monday (March 9), dropping 6.3% to RM3.89 in early trade after the group reported weaker-than-expected first-half earnings on March 6.
Yet beneath the market sell-off, a different signal is emerging. Malaysia’s largest pension fund and company insiders have been accumulating shares at these levels — a pattern that is drawing attention from investors tracking the group’s longer-term earnings trajectory.
The Employees Provident Fund (EPF) acquired 421,600 shares on March 4, according to filings with Bursa Malaysia dated March 9.
Earlier, Ha Tiing Tai, a director of Gamuda, took delivery of 96,700 shares at RM4.7741 on Feb 23 through the maturity of an autocallable structured product. Rather than cashing out, he accepted physical shares and continues to hold them despite a roughly 17% paper loss at current prices.
A disposal by Faris Mohd Yusof, executive director of Gamuda Engineering, involved 23,000 shares worth about RM90,000 — representing roughly 0.03% of his holdings, suggesting a personal liquidity move rather than a directional signal.
All transactions were verified through Bursa Malaysia filings.
The divergence between market sentiment and insider behaviour raises a broader question for investors: whether the market may be overlooking the longer-term earnings cycle embedded in Gamuda’s project pipeline.
Why it matters
For long-cycle infrastructure contractors like Gamuda, earnings often lag project wins. That means share prices can weaken during early project phases — even as the underlying order book that will drive future revenue continues to expand.
The RM44 billion foundation
According to research by Malacca Securities, Gamuda’s construction order book stood at RM44 billion as of the second quarter ended Jan 31, 2026, supported by roughly RM8 billion in unbilled property sales.
Based on FY2025 revenue of RM15.97 billion, according to Bloomberg data, the order book represents approximately 3.5 times revenue cover.
Analysts emphasise that many of these projects remain in the early phases of execution.
Research by Kenanga Investment Bank notes that the recent slowdown in revenue growth reflects “the natural progression” of project life cycles rather than execution issues, adding that stronger earnings are expected in the second half as construction activity accelerates and margins expand.
The RM50 billion target
Management has reiterated its aim of expanding the order book to RM50 billion by December 2026.
According to analysis from Affin Hwang Investment Bank, reaching that target would require roughly RM20 billion in new job wins this year, assuming about RM15 billion in progress billings from existing projects.
Research reports identify several potential contributors to this pipeline:
*Sabah water treatment plant — estimated RM3 billion to RM4 billion
*Penang LRT systems package — approximately RM3 billion, following Gamuda’s earlier civil works win for the Mutiara Line
*Interstate water transfer (Perak to Penang) potentially linked to the RM5 billion Northern Perak Water Supply Scheme, developed via a joint venture with the Perak State Development Corporation
*Data centre projects, which RHB Investment Bank says already account for 8%–10% of the group’s order book
*Renewable energy projects in Queensland, where Gamuda has been selected as preferred bidder by Edify Energy for solar and battery storage developments
*Taiwan MRT packages estimated at RM3 billion–RM4 billion
*Australian high-speed rail tenders, following the Australian government’s call for seven major packages linking Newcastle and Sydney
Research firm CGS International believes the group is well positioned to meet the RM50 billion target.
The firm estimates that every RM2.5 billion increase in new orders during FY2026 could lift FY2027 earnings per share by about 3%.
Analyst consensus remains overwhelmingly bullish
Despite the recent share price decline, analyst sentiment remains strongly positive.
According to Bloomberg data, 20 out of 21 research houses covering Gamuda maintain “Buy” recommendations, with an average 12-month target price of RM5.62 — implying roughly 43% upside from current levels.
Among the calls:
*Affin Hwang Investment Bank — Buy, target RM5.70
*Maybank Investment Bank — Buy, target RM5.30
*Kenanga Investment Bank — Outperform
*CGS International — Add, target RM7.30
*PublicInvest Research — Outperform, target RM5.60
*Hong Leong Investment Bank — Buy, target RM5.60
*TA Securities — Buy, target RM5.98
*RHB Investment Bank — Buy, target RM6.26
Yin Shao Yang, an analyst at Maybank Investment Bank, said management does not expect rising oil prices linked to Middle East tensions to materially affect margins.
She expects earnings to “ramp up throughout FY2026 as the group moves up the S-curve of project execution”, with profits historically peaking in the fourth quarter.
EPF’s long-term position
The latest purchase fits into a broader pattern of accumulation by the EPF.
Documented acquisitions include:
*Sept 18, 2025: 2.788 million shares
*Jan 7, 2026: 9.0207 million shares
*March 4, 2026: 421,600 shares
As of Jan 7, 2026, the EPF held 1.10 billion shares, equivalent to 18.64% of Gamuda’s issued capital, according to filings with Bursa Malaysia.
The shares are held across 16 separate portfolios through Citigroup Nominees (Tempatan) Sdn Bhd.
Property division remains a steady earnings driver
Gamuda’s property arm continues to provide a secondary earnings engine.
The division recorded RM8 billion in unbilled sales as of October 2025.
Research from RHB Investment Bank suggests the group’s RM5.5 billion property sales target for FY2026 is achievable, supported by launches exceeding RM2 billion in Malaysia alongside quick-turnaround developments in Vietnam.
Pivot to recurring income
Since exiting its toll highway concessions in 2022, Gamuda has been repositioning towards businesses capable of generating recurring income streams.
Projects highlighted in analyst reports include:
*Renewable energy collaboration with Gentari, the clean-energy arm of Petronas, under the Corporate Renewable Energy Supply Scheme (CRESS)
*Solar development partnership with SD Guthrie
*A joint venture with Dagang NeXchange Bhd for Google Distributed Cloud isolation services
*The Ulu Padas hydroelectric project in Sabah
*The RM5 billion Northern Perak Water Supply Scheme, structured as a 40-year concession
*Solar farms paired with battery storage systems in Australia and Malaysia
Conclusion
Gamuda’s earnings miss for the first half of FY2026 is real.
But analysts broadly frame it as a timing issue within the construction project cycle rather than a structural deterioration in the business.
Editor’s note: Gamuda Bhd
*Source of information: Statements regarding Gamuda Land’s rejection of the "consolidation trend" and its commitment to a standalone, organic growth target are based on official executive commentary provided today (March 9).
*Market context: Despite ongoing market speculation regarding sector-wide mergers following the Sunway-IJM filings, Gamuda Bhd has issued no formal notification to Bursa Malaysia indicating any intent to participate in such mergers and acquisitions activity.
*Strategic focus: The group's current strategic outlook remains focused exclusively on its existing RM25 billion order book and internal development pipeline.
*Verification status: This position is a confirmed corporate stance as of the latest reporting period and is not derived from third-party speculation.
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