Kedge Construction Co., Ltd. (2546) AI Stock Analysis

Kedge Construction Co., Ltd.

(TWSE:2546)

Select Model

Rating:74Outperform

Price Target:TWD 110.00▲(20.48% Upside)

Action:initiatedcoverage

Date:11/09/26

Kedge Construction scores well on the strength of its finances and valuation. Record 2025 revenue and profit, a conservatively financed, near debt-free balance sheet, ~21% return on equity and a powerful cash flow recovery form a solid foundation, while a 6.4x P/E and ~4.9% dividend yield make the shares attractively priced. The principal risks are steadily eroding gross and operating margins as growth comes from volume rather than pricing power, and the lumpy nature of construction revenue and working capital. Near-term technicals are a drag, with the price slipping below its 20- and 50-day averages and negative MACD momentum, though the stock still trades above its longer-term trend lines.

Positive Factors

Conservative Balance SheetLow leverage and a steadily growing equity base give Kedge financial flexibility to fund projects and withstand periods of uneven construction activity. This conservative capital structure also reduces interest burdens and supports resilience when project timing or profitability becomes less predictable.

Negative Factors

Margin CompressionLower gross margins indicate that Kedge is retaining less profit from each project than it did previously, potentially reflecting cost increases, pricing pressure, or an unfavorable project mix. Persistent compression would reduce earnings resilience and limit the benefit of revenue growth.

Kedge Construction Co., Ltd. (2546) vs. SPDR S&P 500 ETF (SPY)

Market Cap: TWD 13.38B
Dividend Yield: 5.26%
Average Volume (3M): 224.27K
Price to Earnings (P/E): 6.1
Beta (1Y): 0.35
Revenue Growth: 13.48%
EPS Growth: 52.98%
Country: TW
Employees: 622
Sector: General
Sector Strength: 55
Industry: Engineering & Construction

Kedge Construction Co., Ltd. Business Overview & Revenue Model

Company Description

Kedge Construction Co., Ltd., together with its subsidiaries, engages in the construction business in Taiwan. The company constructs housing, market and mall, institution school, technology factory office, and biotech medical projects; and offers civ...

Kedge Construction Co., Ltd. Financial Statement Overview

Summary

A strong financial profile overall. Revenue surged to roughly NT$21.5 billion in 2025 from NT$14.2 billion, net income hit a record NT$1.24 billion (+42%), and the balance sheet is near debt-free with total debt at just 9% of equity and a healthy ~21% return on equity. Cash generation rebounded sharply, with operating cash flow swinging to NT$2.06 billion from negative territory in 2024 and free cash flow converting at roughly 98% of net income, confirming good earnings quality. Offsetting these strengths are steadily compressing margins (gross margin down from 11.3% in 2022 to 8.5% in 2025) and the inherent lumpiness of construction revenue and working capital, which has driven wide swings in sales and cash flow across the cycle.

Income Statement

74Positive

Balance Sheet

83Very Positive

Cash Flow

76Positive

Financial statement breakdown
Breakdown	TTM	Dec 2025	Dec 2024	Dec 2023	Dec 2022	Dec 2021
Income Statement
Total Revenue	23.47B	21.49B	14.23B	14.29B	14.20B	10.77B
Gross Profit	2.70B	1.83B	1.32B	1.51B	1.60B	1.19B
EBITDA	2.39B	1.50B	1.15B	1.21B	1.30B	944.20M
Net Income	1.95B	1.24B	874.36M	990.35M	1.05B	740.48M
Balance Sheet
Total Assets	17.11B	15.18B	13.08B	12.58B	11.80B	9.28B
Cash, Cash Equivalents and Short-Term Investments	7.33B	6.31B	5.65B	5.37B	6.60B	4.42B
Total Debt	557.71M	567.30M	407.84M	122.64M	828.36M	483.89M
Total Liabilities	10.54B	9.15B	7.74B	7.78B	7.61B	5.77B
Stockholders Equity	6.57B	6.03B	5.34B	4.81B	4.19B	3.51B
Cash Flow
Free Cash Flow	648.50M	2.02B	-128.69M	1.20B	908.38M	263.47M
Operating Cash Flow	644.06M	2.06B	-111.81M	1.22B	929.49M	267.34M
Investing Cash Flow	-463.00K	-41.61M	-19.86M	-15.66M	-14.24M	-16.22M
Financing Cash Flow	71.53M	-467.32M	-496.45M	-885.12M	7.53M	-334.40M

Kedge Construction Co., Ltd. Peers Comparison

Overall Rating

UnderperformOutperform

Sector (55)

Financial Indicators

TW:2546 against its peers
Name	Overall Rating	Market Cap	P/E Ratio	ROE	Dividend Yield	Revenue Growth	EPS Growth
TW:2546	74Outperform	TWD 13.19B	6.11	―	5.26%	13.48%	52.98%
TW:2543	57Neutral	TWD 15.06B	10.89	―	5.01%	30.85%	-14.12%
TW:2530	56Neutral	TWD 15.35B	27.01	―	6.70%	-59.46%	-71.61%
Sector *	55Neutral	$6.65B	3.83	-15.92%	6.20%	10.91%	7.18%
TW:2524	50Neutral	TWD 11.63B	38.84	―	―	-77.56%	-89.27%
TW:5213	49Neutral	TWD 14.98B	11.69	―	14.40%	-32.16%	-55.65%
TW:2545	41Neutral	TWD 11.83B	36.84	―	8.96%	-24.11%	-43.91%

* General Sector Average

Performance Comparison

TW:2546 and its peers over the selected period
Ticker	Company Name	Price	Change	% Change
TW:2546	Kedge Construction Co., Ltd.	91.30	13.56	17.44%
TW:2524	King's Town Construction Co., Ltd.	31.80	-9.20	-22.44%
TW:2530	Delpha Construction Co., Ltd.	18.05	-8.59	-32.25%
TW:2543	Hwang Chang General Contractor Co., Ltd.	30.50	-28.92	-48.67%
TW:2545	Huang Hsiang Construction Corporation	31.25	-5.76	-15.57%
TW:5213	YeaShin International Development Co. Ltd.	19.45	-1.73	-8.16%

Glossary

BuyA stock rated as a "Buy" is expected to perform better than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock is likely to deliver higher returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

HoldA stock rated as a "Hold" is expected to perform in line with the overall market or a specific benchmark. This rating indicates that the stock is neither particularly compelling nor unfavorable for investment. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

SellA stock rated as a "Sell" is expected to perform worse than the overall market or a specific benchmark over the near-to-medium term. This rating suggests the stock may deliver lower returns compared to other stocks in the same sector or market index. Note: This is not investment advice; please consult a financial advisor before making investment decisions.

Disclaimer

This AI Analyst Stock Report is automatically generated by our AI systems using advanced algorithms and publicly available financial, technical, and market data. While the information provided aims to be accurate and insightful, it is intended for informational purposes only and should not be considered financial advice. Any content created by an AI (Artificial Intelligence) system may contain inaccuracies and/or contain errors. Investing in stocks carries inherent risks, and past performance is not indicative of future results. This report does not account for your personal financial circumstances, objectives, or risk tolerance. Always conduct your own research or consult with a qualified financial advisor before making investment decisions. The analysis and recommendations provided are based on historical and current data and may not fully reflect future market conditions or unexpected developments. Neither the creators of this report nor its affiliated entities guarantee the accuracy, completeness, or reliability of the information presented. Use this report at your own discretion and risk.

Date of analysis: Nov 09, 2026

Kedge Construction Co., Ltd. AI Stock Analysis