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Positioning for Recovery: Muhibbah on the Edge of a Turnaround
Muhibbah Engineering (M) Bhd is a diversified engineering and infrastructure group.
Between 2019 and 2024, it transitioned into a more focused, vertically integrated solutions provider for the oil & gas and infrastructure sectors. Its core divisions—construction, cranes, concessions, automation, and shipbuilding—remained, but with sharper strategic focus.
Automation, initially an acquisition, became a formal growth pillar, while the crane segment, via Favelle Favco, expanded globally. The infrastructure arm deepened its specialization in platforms, petrochemical works, and heavy steel fabrication, supported by in-house yards. Concessions, especially Cambodia airports, remained relevant but faced regulatory headwinds.
Despite these shifts, performance was weak. Revenue grew at just 3.4% CAGR over six years, with a major loss in 2020 and lackluster ROEs through 2023. The pandemic severely disrupted operations and concession earnings, while recovery was hampered by low margins, underutilized assets, and inflation. ROE only turned meaningfully positive in 2024, reaching 7.7%, as earnings rebounded across concessions, marine, cranes, and automation.
As such you should not be surprised to see it being mapped onto the border of the Turnaround and Gem quadrants in the Fundamental Mapper.
Sustained improvement will depend on global macro stability, continued recovery in travel and infrastructure, and Muhibbah’s ability to execute well and navigate concession-related risks.
