KUALA LUMPUR (May 29): Gadang Holdings Bhd's shares rose as much as 10.75% or five sen at 51.5 sen in morning trade today after the group’s unit Gadang Engineering (M) Sdn Bhd secured two contracts worth a combined RM81.18 million from China Communications Construction (ECRL) Sdn Bhd in respect of the East Coast Rail Link (ECRL) project yesterday.

At 9.45am, Gadang's share price traded 7.35% or 3.5 sen higher at 50 sen. The counter saw some 36.52 million shares traded, making it the eight-most actively traded counter in the local bourse today.

Both the works involve the construction and completion of subgrade earthworks and drainage, Gadang said in a filing with the Bursa Malaysia yesterday, adding that the ERCL projects are expected to contribute positively to the group’s future earnings.

Gadang reported its net profit fell 23.79% to RM35.72 million for the cumulative nine months ended Feb 29, 2020 (9MFY20), from RM46.87 million last year, while revenue grew 10.83% to RM557.46 million, from RM502.99 million.

Gadang attributed the lower earnings for the period to lower profit margin reported for ongoing construction projects, fair value loss on quoted investment of RM6.8 million and an expense of borrowing cost on investment properties of RM1.65 million.

While the stock has risen two times from 23.5 sen on March 23, still, it fell some 38% over the past one year from 81 sen.