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The Sun
11-06-2025
- Business
- The Sun
HEB Group to speed up diversification to drive sustainable growth
KUALA LUMPUR: Engineering and project management consultant HSS Engineers Bhd (HEB Group) is looking to accelerate diversification and drive sustainable growth in the financial year ending Dec 31, 2025 (FY25) and beyond. HEB Group has strategically deepened its involvement in emerging high-growth sectors to broaden its sectoral coverage, while maintaining an entrenched presence in its core infrastructure domains of highways, roads, rail, ports and water infrastructure. With the rapid expansion of the data centre industry, the group anticipates sustained growth in this sector, supported by favourable government policies and robust foreign investment. HEB Group's substantial RM2.1 billion order book will provide earnings visibility over the next eight years, building upon the momentum created by the record-high net profit of RM25.2 million achieved in FY24. The order book includes key projects such as the Pan Borneo Highway Sabah Phase 1A, Westports Expansion Development, Klang Valley Double Tracking Phase 2, East Coast Rail Link, Jajaran Rel Selangor Kita, multiple water infrastructure and data centre projects in Malaysia, in addition to several overseas projects. The group also has a healthy tender book of RM475 million as it proactively pursues new opportunities in Malaysia and abroad. 'HEB Group has demonstrated agility by adapting its business model to meet the rapidly evolving engineering needs of various industries,' executive vice-chairman Tan Sri Kuna Sittampalam said after HEB Group's annual general meeting today. 'We are rapidly expanding our capabilities to take a leading role in emerging industries that are set to reshape the region.' Kuna said the group's timely diversification strategy will pave the way for sustainable growth and long-term value creation. Concurrently, HEB Group remains steadfast in its role of supporting governments, both at home and abroad, in implementing strategic infrastructure projects to stimulate economic growth and elevate living standards. As for its international operations, HEB Group is well on its way to achieving its target of deriving 25% of revenue from overseas projects by 2027. Overseas projects contributed 18.8% of revenue as at March 31, supported by numerous contracts wins in developing countries across Asia. Kuna said the group is associated with nine countries for projects and that a project in Iraq is providing value-accretive yields with RM1.5 billion in fees. 'However, I expect our Southeast Asian partners like Indonesia and the Philippines will start to contribute more to the company over the next two to three years.' At the AGM, shareholders approved all the resolutions tabled by the group, including the payment of a final single-tier dividend of 1.46 sen per share for FY24. The dividend payout of RM7.4 million represents about 30% of the HEB Group's net profit last year, and is in line with its dividend policy, which targets 30% distribution of annual net profit to shareholders.
New Straits Times
11-06-2025
- Business
- New Straits Times
HSS Engineers bullish about FY2025, beyond due to projects diversification
KUALA LUMPUR: HSS Engineers Bhd remains optimistic about its growth outlook for the financial year ending Dec 31, 2025 (FY25) and beyond, as it ramps up efforts to expand and diversify its project portfolio across various sectors and international markets. HSS Engineers said it had increased its involvement in emerging, high-growth industries to widen its sectoral reach, while continuing to maintain a strong foothold in its core infrastructure areas including highways, roads, rail, ports and water systems. It also highlighted the rapid growth of the data centre industry, projecting continued momentum in this space, driven by supportive government policies and strong foreign investment. "Concurrently, the group's tech-based subsidiary HSS Propick Technologies Sdn Bhd (HSS Propick), a provider of artificial intelligence (AI) powered drone solutions, is undertaking an expansive telco tower digitalisation project for one of Southeast Asia's largest telco tower companies. "HSS Propick encapsulates the group's focus on innovation, harnessing its deep-rooted engineering expertise to deliver AI-powered infrastructure solutions," it added. HSS Enegineers said it is poised to play a key role in Sarawak's fast-paced industrialisation, with its local associate company HSS Alliance (Sarawak) Sdn Bhd, nearing substantial growth as it positions itself as a trusted one-stop engineering partner for the state's large-scale infrastructure transformation. HSS Engineers executive vice chairman Tan Sri Ir. Kuna Sittampalam said it had demonstrated agility by adapting its business model to meet the rapidly evolving engineering needs of various industries. "Building on our success in AI-powered drone solutions to data centres and solar power generation, we are rapidly expanding our capabilities to take a leading role in emerging industries that are set to reshape the region. "Our timely diversification strategy will pave the way for sustainable growth and long-term value creation," he said. During the annual general meeting, Kuna reaffirmed that the company's robust RM2.1 billion order book will ensure earnings visibility for the next eight years, reinforcing the momentum gained from its record-high net profit of RM25.2 million in the financial year ended 31 December 2024 (FY2024). The order book comprises major projects such as the Pan Borneo Highway Sabah Phase 1A, Westport 2 Expansion Development, Klang Valley Double Tracking (KVDT) Phase 2, East Coast Rail Link (ECRL), Jajaran Rel Selangor Kita, as well as numerous water infrastructure and data centre developments across Malaysia, along with several international projects. It continues to maintain a solid tender book worth RM475 million as it actively seeks new opportunities both locally and overseas.
New Straits Times
09-06-2025
- Business
- New Straits Times
IJM Corp, Muhibbah Engineering to benefit from ECRL spur line
KUALA LUMPUR: IJM Corporation Bhd and Muhibbah Engineering (M) Bhd are among the companies expected to benefit from the East Coast Rail Link (ECRL) spur line, which provides direct connectivity to two major ports in Port Klang, CIMB Securities Sdn Bhd said. In a note today, the brokerage said IJM stands to benefit once the ECRL service is commercially operational. It owns and manages Kuantan Port through its 60 per cent stake in Kuantan Port Consortium (the remaining 40 per cent is held by China's Guangxi Beibu Group). CIMB Securities, which gave the stock a "buy" recommendation with a target price (TP) of RM3.40, noted that IJM signed a memorandum of understanding with Malaysia Rail Link (MRL) on June 10, 2024, to jointly explore ways to maximise the potential of logistical services within the ECRL corridor. "By leveraging the ECRL's network, IJM believes that this multimodal service will enhance Kuantan Port's logistical reach as the premier gateway to the East Coast of Peninsular Malaysia," it added. CIMB Securities said similar gains are expected for Muhibbah Engineering, which owns the rights to develop the Kuantan Maritime Hub (KMB) land bank that is strategically located right next to Kuantan Port. It has issued a "buy" call on the engineering construction company's shares with a TP of RM1.10. The stockbroking firm said that the 202.35-hectare KMB, which is estimated to cost RM2.1 billion to develop and targeted for completion in 2034, will have world-class shipbuilding facilities that complement the robust prospects of the ECRL. On downstream activities, CIMB Securities said Malayan Cement Bhd — which it has given a "buy" recommendation with a TP of RM6.35 — to secure additional orders from the ECRL spur line, as it continues to supply cement to the project on a non-exclusive basis. It said the unveiling of the ECRL spur line is within its expectations, as it forms part of the original 665-kilometre (km) ECRL alignment. It noted that, as of April 2025, construction progress on the ECRL had reached 82.5 per cent, about two and a half months ahead of schedule.
New Straits Times
08-06-2025
- Business
- New Straits Times
YTL Power's AI compute could lift FY26 earnings by 4pct
KUALA LUMPUR: YTL Power International Bhd's artificial intelligence (AI) compute initiative is on track for a launch in the third quarter of 2025 (3Q25). Maybank Investment Bank Bhd (Maybank IB) expects this to drive a potential net profit increase of around four per cent in financial year 2026 (FY26) and six per cent in FY27. The firm continues to view YTL Power's risk-reward profile positively, especially given its undemanding valuations. This optimism is supported by the anticipated confirmation of Wessex's medium-term recovery as well as encouraging progress in its data centre and AI compute business. Maybank IB maintained a 'Buy' rating on YTL Power with an unchanged target price of RM4.20. Based on news reports, it said the group's AI compute business is on track to go live in 3Q25. "While substantially more capital expenditure intensive on a per megawatt (MW) basis, the gestation period is likely minimal, unlike data centre colocation, because graphic processing units, which are the biggest cost item, are typically only procured after securing off-takers. "Thus, upon commissioning, AI compute is likely to be immediately earnings accretive to YTL Power, in our view," it added. Assuming a 20MW deployment as planned, Maybank IB said YTL Power could incur about RM2.1 billion in capital expenditure, which could, in turn, generate around RM130 million in profit after tax annually. It said a 3Q25 launch for the initial 20MW would allow AI compute to contribute at least three quarters to YTL Power's FY26, potentially lifting its net profit forecasts by about four per cent and six per cent for FY26 and FY27, respectively.
New Straits Times
03-06-2025
- Business
- New Straits Times
TNB ordered to pay RM547k in late interest to landowner
PUTRAJAYA: Tenaga Nasional Bhd (TNB) has been ordered to pay RM547,105 in late payment interest to a company for delays in compensating it for land used in a transmission line project. A three-member Court of Appeal panel led by Federal Court judge Datuk Lee Swee Seng said the national utility giant must pay the sum to Lambang Kelana Sdn Bhd after finding that the company had been unfairly deprived of its money for over five years due to administrative delays. Other members of the bench were Court of Appeal judges Datuk Azimah Omar and Datuk Wong Kian Kheong. According to court documents, in 2007, TNB had prematurely entered Lambang Kelana's land without due compliance with wayleave procedures under Section 11 of the Electricity Supply Act to install electrical infrastructure. The section stipulates that utility companies must follow specific procedures before entering private land to install or build electrical infrastructure, including giving formal notice to landowners and paying full compensation for any disturbance or loss of use of the land. Lambang Kelana was neither served the statutory notice nor paid proper compensation for the loss of the portion of land acquired as wayleave for TNB. The dispute led to a protracted legal battle, and TNB only paid RM2.1 million in compensation in 2020. However, the payment did not include any interest for the long delay. In 2021, the Negri Sembilan State Authority decided that Lambang Kelana should receive RM1,369,332.95 in late payment interest for the delay in compensation from October 2015 to December 2020. However, TNB filed a judicial review to challenge the decision in the High Court and succeeded in getting it overturned. Azimah, who delivered the unanimous decision in dismissing the lower court's ruling, said the trial judge had misinterpreted the law by adopting a narrow and literal reading of the relevant provisions. "To deprive the appellant of its rightful late payment charges would certainly transgress upon the appellant's constitutional rights safeguarded under Article 13(2) of the Federal Constitution. "Despite the delay caused by the Land Administrator, TNB was still unjustly enriched by being able to utilise and earn interest on the monies that were supposed to be paid to Lambang Kelana for the entire duration of the delay," she said. The appellate court said any interpretation of the law that allows government authorities or licensees to delay compensation with impunity would be unjust. "We are certain that no statute ever legislated within our nation would promote a statutory authority to delay justice with impunity at the expense of unjust losses incurred against innocent landowners. "If that be the case, then TNB would stand to unjustly benefit by holding onto monies that should have been paid to landowners, courtesy of delays by the Land Administrator. "In the meantime, the Land Administrator would not suffer a single sen for the entire duration of the delay. The only party to suffer losses would be the landowner. "Such an interpretation would truly be absurd and unjust," the court added. The court also did not make any order for costs. Lambang Kelana was represented by lawyers Yeoh Cho Kheong and T. Subbbiah, while lawyer David Dinesh Mathew appeared for TNB.
