According to analysts, Muhibbah Engineering (M) Bhd is anticipated to gain from a resurgence of tourism in Cambodia.
 
The business controls an effective 21% share in Cambodia Airports, which oversees two airports.
 
According to research by CGS International Research (CGSI Research), it is also probably going to secure more jobs at Petroliam Nasional Bhd (PETRONAS) through its PETRONAS fabrication licence.
 
The research firm stated, "We hosted a meeting with Muhibbah's management on September 12 and in our view, the key takeaway is possible large lumpy wins after a lull."
 
It stated that although it had dropped from its most recent height of RM2.4bil on November 23, Muhibbah's order book for construction and cranes remained strong as of August 24 at RM1.6bil. 

Although it hasn't yet secured any significant contracts this year, it has put in a sizable bid for the engineering, procurement, construction, and commissioning of Sarawak's Lang Lebah gas field.
 
"We see it being a frontrunner for this project given its prior experience with similar projects in Gansar, Bekok, and Bindu in Terengganu," the research house stated.

Passenger arrivals at the two airports in Cambodia increased by 18% year-over-year (y-o-y) to 2.3 million in the first half of 2024 (1H24), according to CGSI Research, and are expected to reach five million for the full year.
 
The research firm also stated that the majority of Muhibbah's 1H24 associate profits—which increased 63% year over year to RM30 million—came from Cambodia Airports. 

"This is praiseworthy since the Siam Reap airport concession was part of 1H23."
 
The research house stated that the current Phnom Penh airport would be replaced with Techno International Airport in Kandal, near Phnom Penh, which is 80% complete and scheduled to open in mid-2025, citing The Khmer Times.
 
"We continue to believe that the most likely scenario is that Cambodia Airports will be paid for its investment up until the concession for the Phnom Penh airport is given up and that it will be hired to operate the new airport at Kandal, with a fixed fee structure and a profit-sharing component," the research firm stated.
 
It stated that it preferred Muhibbah because of its inexpensive valuation at the price-earnings ratio of eight times for the upcoming fiscal year, as opposed to the sector's 17 times; nevertheless, it also pointed out that the two main risks were the non-continuity in earnings delivery and increased costs for raw materials.

Stronger visitor arrivals in Cambodia and improved earnings delivery are two factors that could drive the company's re-rating, according to the research house