Underpinned by higher delivery volumes in the current FY2026, Chong has raised his earnings estimates by 15% and thereby, his target price.
For its 2HFY2025 ended September, BRC Asia reported earnings of $52.2 million, down5.1% y-o-y. Adjusted patmi, which excluded a one-off disposal gain of $16.5 million booked in the year earlier, was up 35.6% y-o-y to $49.1 million, as the company delivered a higher volume which offset lower prices.
Chong sees even brighter prospects ahead, with a ramp-up in steel rebar delivery volumes over the subsequent quarters reaching a peak in 2026-27.
He believes the key drivers for this demand growth will come from a higher number of HDB flats to be built, and also additional contracts linked to the airport's Terminal 5.
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Chong expects BRC Asia to capture some business from the expansion of the Marina Bay Sands integrated resort as well.
"We believe BRC Asia’s higher delivery volumes, driven by its $1.9 billion order book, will offset the impact of falling steel prices on its FY2026 revenue," he adds.
BRC Asia shares last traded at $3.93.
