Critical Holdings raises Kulim Hi-Tech Park cleanroom contract value to RM226.68 million

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Highlights

Critical Holdings raises the value of its Kulim Hi-Tech Park cleanroom construction contract to RM226.68 million after a RM74.1 million increase in scope of work.
The seven-month project by Critical Engineering Solutions began on 11 May and is scheduled for completion on 25 December, with the contract's core terms unchanged.
Critical Holdings shares rose 2.55% to RM2.82 and have surged 158.7% since the end of June, driven by a major RM772.49 million contract and improved order-book visibility.

This article was translated from the original. Read the original version by our correspondent here.

Contract revision and project timeline

The Edge Malaysia reported that Critical Holdings Bhd said in a stock exchange filing on Tuesday that the contract value for the construction of cleanroom facilities for an unnamed U.S.-based multinational company has been raised to RM226.68 million from RM152.59 million.

The underground utilities and substation engineering company said the RM74.1 million addition followed modifications to the scope of work. Other terms and conditions for the work awarded by the multinational group, which supplies wafer fabrication equipment and services to the semiconductor industry, remain unchanged.

Critical Holdings secured the contract in May this year through its wholly owned subsidiary, Critical Engineering Solutions Sdn Bhd. The seven-month project, which began on 11 May, is scheduled for completion on 25 December, with the previously announced scope covering cleanroom architecture as well as mechanical, electrical and process utility services.

Impact on the shares and the group's outlook

Critical Holdings shares have remained in focus since the middle of this year, when the group secured a RM772.49 million engineering, procurement and construction contract on 30 June for the development of a high-tech industrial facility at Kulim Hi-Tech Park. The contract was also awarded by a U.S.-based multinational company that supplies wafer fabrication equipment and services to the semiconductor industry.

The contract value is nearly 10 times the average size of contracts won by Critical Holdings, prompting several analysts to revise their earnings forecasts and target prices for the group. At the close of trading, its shares rose seven sen, or 2.55%, to RM2.82, giving the company a market capitalisation of RM1.15 billion.

The share price has surged 158.7% from RM1.09 at the end of June and is up more than 213% since the start of the year. This latest increase in contract value further strengthens the group's order-book visibility in Malaysia's semiconductor supply chain.

In our earlier coverage of Malaysia's semiconductor export tariff exemption to the U.S., we explained that trade negotiations under Section 301 are ongoing, but there had been no indication so far that tariffs would be imposed on the sector. The article also outlined the compliance issues under discussion — including forced labour and excess capacity — and highlighted the importance of strengthening supply chains and diversifying partnerships and markets to support the growth of high-value industries.

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