Signature Alliance Group Berhad: A Scalable Interior Fitting-Out Specialist with Forward Growth Visibility

Signature Alliance Group Berhad (“SAG”), a seasoned interior fitting-out service provider, is poised to list on the ACE Market of Bursa Malaysia on 5 June 2025. Priced at RM0.62 per share with a public issue of 260 million new shares, the IPO values the company at RM620.0 million, translating into a historical price-to-earnings (P/E) ratio of 15.3 times based on FY2024 earnings.

While this valuation sits within a fair range for the construction-related sector, it becomes more compelling when considering the Group’s forward earnings potential.

As at 16 April 2025, SAG held RM388.6 million in unbilled contract value from an overall RM902.4 million project pipeline, a figure expected to be progressively recognised over the next one to two financial years.

This provides strong revenue visibility and sets the foundation for improved profitability ahead, coupled with their tender book value of RM1.1 billion with a historical win rate of 15% ~ 20%, this implies that the forward P/E is likely to be lower than current estimates.

Established in 2009, SAG has built a reputation for delivering customised, end-to-end interior fitting-out solutions across commercial, industrial, and residential segments. To date, the Group has successfully completed over 624 projects valued at RM391.6 million between FY2021 and FY2024.

Its client base spans local corporations and multinational companies, and notably includes high-profile projects in the Tun Razak Exchange (TRX), Menara Chin Hin, and a popular retail coffee chain with nationwide presence: all of which underscore SAG’s strong track record in delivering high-specification fit-outs for reputable names.

Revenue has grown substantially from RM73.4 million in FY2021 to RM386.0 million in FY2024, registering a robust 4-year CAGR of 51.3%. Net profit surged even more significantly, from RM2.7 million to RM40.6 million over the same period, supported by operational leverage and improved project margins.

A key competitive advantage for SAG lies in its integrated operations, which include in-house manufacturing of joinery, fixtures, and customised furniture through facilities located in Bandar Baru Bangi and Puchong.

This vertical integration enables better quality control and cost efficiency. The Group is also a CIDB G7 certified contractor, allowing it to bid for projects with no contract value limit, a critical enabler for scaling.

The RM161.2 million raised from the IPO will fund the development of a new centralised corporate office and 50,000 sq ft production facility in Selangor, both targeted for completion by June 2028. These infrastructure investments, alongside branch expansions into Penang and Johor, acquisition of machinery, and working capital injection, reflect SAG’s proactive strategy to meet growing demand and scale operations sustainably.

Post-listing, SAG is expected to maintain a healthy balance sheet with low gearing of just 0.1x and strengthened liquidity, positioning it well to undertake larger and more complex contracts.

In essence, while the IPO comes at a 15.3x trailing P/E, the substantial unbilled order book and clear growth roadmap suggest meaningful forward upside. For investors seeking exposure to a niche but growing segment within Malaysia’s construction and property ecosystem, particularly one anchored by a solid operating history and premium clientele, SAG represents a well-positioned and promising new entrant on Bursa.