IJM Corp Bhd is poised to sustain strong earnings through the financial year ending March 31, 2029 (FY29), supported by a substantial order book and ongoing involvement in Malaysia’s data centre and industrial building sectors. The group’s planned standalone listing of its construction division in the third quarter of FY27 (3Q27) is also expected to enhance market valuation of the business.
According to Apex Research, which recently initiated coverage on IJM, the company’s outstanding order book of RM14.5 billion is sufficient to keep operations robust well beyond FY29. This represents an order book-to-revenue coverage ratio of 2.1 times relative to the group’s FY26 construction revenue, exceeding the typical one- to two-year visibility generally seen among contractors.
Management has set a FY27 new order target of RM9 billion, with RM6 billion expected from Malaysia and RM3 billion from overseas markets. Apex Research noted that IJM had already secured RM1.8 billion in new contracts year-to-date, positioning the company to maintain order book growth into FY28. Additionally, the group holds a tender book worth RM18 billion, offering further potential for replenishing its backlog.
A significant portion of IJM’s Malaysian order book—55%—is currently attributed to data centres and industrial buildings, sectors that are driving growth. IJM Land’s RM1.96 billion joint venture with Minister of Finance Inc and Southern Catalyst Sdn Bhd to develop an industrial park in Sedenak further strengthens its industrial corridor exposure. Internationally, the UK-based associate JRL, of which IJM owns 50%, and Singapore-based Hexacon, with a 45.5% stake held by IJM, contribute approximately RM5 billion and RM2.2 billion respectively to the overall order book.
Apex Research highlighted that the planned spinoff and standalone listing of IJM's construction arm is likely to improve earnings transparency and allow investors to value the construction business on a more independent basis.
Beyond its construction activities, IJM’s Industry division offers a notable earnings advantage. This division records the highest profit-before-tax margin at 16.8%, benefiting from in-house spun-pile manufacturing. This vertical integration enables IJM to reduce reliance on external suppliers and mitigate the impact of input cost inflation. The group is also a leading supplier of external piles in Malaysia. Furthermore, IJM’s proprietary "bubble deck" precast technology, employed in projects like RTS Link, represents a niche innovation with limited competition in the market.
Apex Research initiated coverage of IJM with a “buy” recommendation and set a price target of RM3.48 per share. The valuation is based on a sum-of-the-parts analysis, using price-to-earnings multiples of 22 times for FY27 core net profit in construction, 20 times for manufacturing and quarrying, and 20 times for the port division—with 60% attributed value assigned to the latter. The assessment also includes discounted cash flow valuation for toll-road concessions, a 50% discount on revalued net asset value for property assets, and market values for listed associates.