KUALA LUMPUR (Aug 22) – Shares of Malayan Cement Bhd climbed on Friday after the company delivered stronger-than-expected earnings, prompting analysts to raise their outlook on Malaysia’s largest cement producer.

The stock surged as much as 30 sen, or nearly 6%, to RM5.62 before easing to RM5.53 at 2.40pm, valuing the company at RM7.5 billion. Nearly two million shares changed hands during the session. Year-to-date, Malayan Cement has advanced about 14%, with analysts projecting as much as 30% further upside over the next 12 months. Bloomberg data showed the average target price rising to RM7.20 from RM6.86 earlier this week, with all six analysts covering the stock maintaining ‘buy’ recommendations.

The upbeat sentiment reflects Malayan Cement’s position as a proxy to Malaysia’s expanding construction sector, which is being fuelled by large-scale public projects such as the Klang Valley MRT3, Penang’s LRT, and Johor’s autonomous rapid transit and water infrastructure works. A healthy pipeline of private developments—ranging from warehouses and data centres to residential projects—is also expected to bolster demand, according to MBSB Research.

For the financial year ended June 30, 2025, the group reported a net profit of RM672.39 million, up 57% from a year earlier and about 7% above consensus estimates. Fourth-quarter earnings alone surged 50% year-on-year to RM165 million. CIMB Securities said the company’s premium valuation is justified by its market dominance, solid balance sheet, and return-on-equity forecast of 10–11% between FY2026 and FY2028.

Strategic assets are also enhancing the outlook. Malayan Cement’s Pasir Gudang plant, the only integrated cement facility in Johor, is expected to benefit from the Johor-Singapore Special Economic Zone and Singapore’s own infrastructure spending. Meanwhile, Hong Leong Investment Bank noted that the group’s pricing power, along with operational efficiencies, should help offset cost pressures from higher coal prices and electricity tariffs.

The stronger earnings momentum, coupled with structural demand drivers, places Malayan Cement firmly at the centre of Malaysia’s construction and infrastructure growth story.

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Bernard Lee

Bernard is a social activist dedicated to championing community empowerment, equality, and social justice. With a strong voice on issues affecting grassroots communities, he brings insightful perspectives shaped by on-the-ground advocacy and public engagement. As a columnist for The Ledger Asia, Bernard writes thought-provoking pieces that challenge norms, highlight untold stories, and inspire conversations aimed at building a more inclusive and equitable society.