Kelington’s India job win might be precursor for more projects

By the Editorial Team · Wednesday, September 16, 2026

Kelington Group Bhd secured its largest-ever RM1.83 billion contract to oversee the design and installation of tools at a semiconductor fabrication facility in Gujarat, India, set for completion by February 2029. This deal boosts Kelington’s order book substantially and positions the company to benefit from the growing semiconductor manufacturing sector, with analysts forecasting significant revenue contributions and upward earnings revisions through 2028.

Kelington Group Bhd’s recent RM1.83 billion contract award in India marks the company’s largest project win to date and signals potential for further opportunities as the country advances its semiconductor industry development, according to market analysts.

The contract, secured for the design, installation, connection, testing, and handover of manufacturing, laboratory, and support tools at a semiconductor fabrication facility in Gujarat, spans 30 months with a targeted completion date of February 2029. It covers hook-up works across two facility modules and involves up to 886 tools. Kelington will serve as the main contractor for the project.

Kenanga Research highlighted that this milestone strengthens Kelington’s medium-term earnings visibility and positions the company as a direct beneficiary of front-end wafer fabrication expansion. The research firm estimates that, assuming even execution throughout the contract period, the project could contribute approximately RM730 million in annualised revenue once operating at full capacity. However, actual revenue recognition will depend on project progress and milestone fulfillment.

This latest award increases Kelington’s total new contract wins for 2026 to RM3.59 billion, a significant rise from RM1.23 billion secured in the first half of the year and RM538 million from July and August. In response, Kenanga adjusted its full-year 2026 new contract win projection upward to RM4 billion from an earlier estimate of RM2.1 billion while maintaining its earnings forecasts, given that revenue recognition is expected to span two to three years.

RHB Research also expressed a positive outlook following Kelington’s latest contract success. The firm noted that cumulative orders now exceed the total secured over the previous three years combined and surpass its prior conservative order book replenishment assumption of RM2.5 billion. According to management insights cited by RHB, Kelington’s tender book currently exceeds RM8 billion, up from RM7.5 billion in the second quarter.

RHB emphasized the potential for sizable tender outcomes by year-end, including RM3.7 billion from Singapore, representing nearly half of the second-quarter tender book, and RM995 million from Malaysia. Reflecting the improved order pipeline and revised margin assumptions, RHB raised its earnings forecasts by 1% for 2026, 11.2% for 2027, and 15% for 2028. It maintained a "buy" rating on Kelington, increasing the target price to RM11.70 from RM10.50.

Kenanga reaffirmed its “outperform” rating, citing Kelington’s robust order and tender books, diversified regional exposure, and strong positioning within the front-end semiconductor capital expenditure cycle. The firm kept its target price at RM10.10.

The semiconductor sector is undergoing significant capital investment worldwide, and Kelington’s expanding footprint aligns with the anticipated multi-year growth in wafer fabrication facilities, particularly in emerging markets like India.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.