CAHYA MATA SHARES RISE FOLLOWING RM550 MLN STATE CONTRACT FOR KUCHING CONVENTION CENTRE

KUALA LUMPUR, April 22 (Bernama) -- Cahya Mata Sarawak Bhd (CMSB) has experienced a notable increase in its share price following the announcement that its 51 per cent-owned subsidiary, CMS Land Sdn Bhd, secured a RM550 million contract from the Sarawak state government.

Under the contract, CMS Land was chosen to design and build the Borneo Convention Centre Kuching II in Muara Tebas, Kuching, said the diversified group in a filing with Bursa Malaysia on Monday. 

The contract encompasses a comprehensive scope of work, including foundation, substructure, superstructure, mechanical and electrical installations, fit-out works, testing and commissioning.

Construction works commence in April 2025, with scheduled completion by the first quarter of 2028.

At lunch break, CMSB shares inched up half-a-sen to 91 sen with 1.56 million shares traded. 

In a research note today, MIDF Amanah Investment Bank Bhd (MIDF Research) said the award highlights CMSB’s strong market position in Sarawak, reinforcing the research firm's positive view on its strategic alignment with state-driven projects.

In addition, it said the latest contract also boosts CMSB’s order book significantly, further improving earnings visibility over the medium term.

“The RM550 million award will positively impact the group's financial performance from the financial year (FY) 2025 to FY2028,” it said. 

The research firm said CMSB's strategic involvement in high-profile government infrastructure developments underscores its pivotal role in Sarawak's ongoing economic and infrastructure growth.

“Historically, CMSB has delivered consistent operating profit margins from infrastructure contracts, and we expect similar stable margins for this government-backed project, benefiting from internal synergies and cost efficiency,” said MIDF Research, adding that it is keeping earnings estimates unchanged at this juncture.

Despite external headwinds, CMSB’s vertically integrated operations, efficient cost structure, and alignment with Sarawak’s infrastructure agenda continue to provide a solid foundation for long-term performance.

“Backed by strong internal synergies and a government-supported pipeline, CMSB remains well-positioned to sustain its momentum and navigate near-term challenges,” said MIDF Research.

-- BERNAMA