Southern Score Builders Bhd has secured a RM78 million contract to upgrade a detention pond in Kuala Lumpur, awarded through its subsidiary to a project that involves a related-party dynamic within the group’s ownership structure. The venture underscores the ongoing strategic push by Southern Score into larger-scale construction management projects, while also highlighting governance considerations that accompany dealings with entities linked to key family shareholders. The project is slated to run for a year, with a focus on delivering upgraded detention capacity in a rapidly developing urban corridor in Malaysia’s capital. The award’s structure ties Southern Score to Seribu Megah Sdn Bhd, a wholly owned subsidiary of Radium Development Bhd, setting the stage for a transaction that regulators and market participants will scrutinise for governance norms and value creation potential.
Contract Award Details and Related Party Transaction
Southern Score Builders Bhd confirms that a RM78 million contract has been awarded for the proposed upgrading works to a detention pond in Kuala Lumpur. The contract has been allocated to Southern Score Sdn Bhd (SSSB), the group’s wholly owned subsidiary, by Seribu Megah Sdn Bhd. Seribu Megah Sdn Bhd operates as a property development arm within the Radium Development Bhd ecosystem, with Radium holding full ownership of Seribu Megah. The nature of this arrangement categorises the contract as a related-party transaction because the managing director of Southern Score, Tan Sri Gan Yu Chai, has siblings—Gan Kah Siong, Gan Kok Peng, and Gan Tiong Kian—who are major shareholders and directors of Radium Development Bhd. This familial and cross-ownership link creates a governance dynamic that is common in diversified corporate groups but warrants careful oversight to ensure that the contract terms, pricing, and procurement processes are transparent and in the best interest of all shareholders.
The contract is scheduled to span 12 months, requiring the project to commence upon award and proceed through a defined timetable designed to culminate in completion within the following year. While the exact calendar dates of commencement and completion are provided in the original filing, the essential takeaway is the one-year horizon that frames performance, revenue recognition, and cost management for the project period. In a broader sense, this arrangement situates Southern Score within a portfolio of projects that may benefit from synergies between its construction capabilities and Radium’s development pipeline, while also raising considerations around conflict-of-interest management, independent oversight, and the need for arm’s-length contracting practices.
From a governance perspective, related-party transactions such as this require robust disclosure, clear approval processes, and appropriate monitoring to safeguard minority shareholders and maintain market confidence. The company’s current corporate governance framework, including the presence of independent directors, audit committees, and transparent procurement procedures, will be instrumental in evaluating whether the terms of the engagement reflect fair market value and objective assessment of risk and reward. Investors and analysts generally expect related-party arrangements to be accompanied by independent verification of pricing, scope, and project milestones, along with regular progress reporting that provides a transparent view of cost allocations, change orders, and potential contingencies that could affect the contracted RM78 million value.
In practical terms, stakeholders should assess the potential for conflicts arising from the intertwined leadership and ownership structures. For example, while the project promises a consolidated execution model with the parent group’s resources, it also presents a risk where management incentives could align with internal alignment rather than pure market-based considerations. Consequently, the market will be attentive to how Southern Score communicates project milestones, cost-control measures, governance checks, and any adjustments that may arise during the upgrade works. The 12-month duration also implies a concentrated period of revenue recognition for this contract, which may influence quarterly results and project-based working capital requirements as the company progresses toward completion.
Company Background and Listing Transition
Southern Score Builders Bhd’s corporate evolution is a notable narrative within the Malaysian construction and infrastructure sector. The group traces its roots to an IT services lineage under the entity formerly known as G Neptune Bhd. A pivotal strategic pivot occurred through a reverse takeover by Southern Score Sdn Bhd (SSSB) in November 2022, propelling the firm into construction, with a particular emphasis on high-rise residential construction management. This shift marks a significant transformation in the company’s core competencies, market positioning, and growth trajectory, as it moves away from software and IT services toward on-the-ground engineering, procurement, and construction (EPC) activities.
In the broader corporate strategy, Southern Score is advancing a transition from the Alternative Market of Bursa Malaysia (ACE Market) toward a primary platform on the Main Market. The decision to pursue a Main Market listing underscores the company’s ambition to access a broader investor base, enhance liquidity, and position itself for larger-scale projects that align with Malaysia’s growing infrastructure and urban development needs. The move to the Main Market is often associated with higher disclosure standards, more stringent corporate governance expectations, and greater scrutiny from analysts and investors, all of which can bolster the company’s reputation and funding agility as it competes for substantial tenders and multi-year contracts.
From a historical standpoint, the transformation into a construction-focused entity was reshaped by the reverse takeover, which effectively folded in Southern Score Sdn Bhd’s operational capabilities and project focus into the listed vehicle. The strategy appears to be to leverage SSSB’s track record in the construction space to support Southern Score’s growth ambitions on the main market, while benefitting from the credibility that accompanies a larger, more mature listing profile. The listing transition is not merely a change of exchange venue; it signals a broader maturity in governance, reporting, and investor relations that typically accompany larger capitalization and broader market visibility. For Southern Score, the transition also implies heightened expectations from creditors, suppliers, and customers who may view the Main Market listing as a marker of financial discipline, project execution capability, and resilience in competitive environments.
In practical terms, the listing transition process involves a series of regulatory checks, financial disclosures, and governance enhancements designed to meet the Main Market’s standards. Management and the board would need to align internal controls, risk management frameworks, and board composition with the stringent requirements of a higher-tier exchange. This alignment not only supports funding and project opportunities but also reinforces stakeholder confidence across a broader capital market spectrum. The decision to pursue the Main Market listing may be viewed by investors as a signal of ambition and a longer-term plan to scale operations, broaden project exposure, and capture a more diversified project mix in the construction and related sectors.
Beyond governance, this strategic move carries implications for capital structure, working capital management, and potential dividend policy adjustments as the company’s access to funding channels broadens. It also places greater emphasis on transparent reporting of project pipelines, backlog, and milestone-based revenue recognition, given that Main Market investors typically demand stable, defensible growth trajectories and consistent returns on invested capital. For Southern Score, the Main Market path complements its overarching ambition to be recognized as a credible player in high-rise construction management, particularly as urban development activity in Kuala Lumpur and surrounding areas remains robust and as infrastructure initiatives continue to drive demand for qualified execution partners.
Financial Performance: FY2024 Results and Implications
In the latest reported fiscal period, Southern Score posted a net profit of RM31.45 million, marking a 24.26% year-over-year increase. Revenue for the same period rose to RM170.72 million, a substantial 74.32% expansion compared with the prior year. These results reflect a material acceleration in top-line activity, supported by a more robust project portfolio and improved operating leverage. The combination of higher revenue and growing profitability indicates that the company may be realizing benefits from scale, optimization of project management processes, and potential efficiency gains in procurement, labor utilization, and site management across its project mix.
The 12-month detention pond upgrade contract, along with other ongoing projects, appears to be contributing to a stronger revenue line. In a construction context, such outcomes often imply improved margins on larger, well-planned projects where procurement strategies, subcontractor management, and site productivity drive favorable cost performance. The overall growth trajectory observed in FY2024 could be interpreted as evidence of successful execution capabilities and a stronger market position, enabling Southern Score to pursue an expanded project portfolio with greater confidence. However, the concentration of revenue from key contracts, especially those linked to related-party arrangements or significant capital expenditure, would warrant careful monitoring of risk factors such as project delays, cost overruns, and liquidity requirements.
From a capital allocation perspective, the earnings growth and revenue expansion position Southern Score to potentially strengthen its balance sheet as it transitions to the Main Market. Access to broader capital markets can facilitate working capital facilities, surety bonds, and larger project financing arrangements, all of which are critical for sustaining a pipeline of high-value contracts. The company’s governance framework will be pivotal in maintaining investor trust, especially as the group’s ownership structure includes family-linked entities with significant influence on Radium Development Bhd. Transparent disclosures around project pipelines, order backlogs, and risk-adjusted profitability metrics will be essential to demonstrate resilience and add credibility to statements about future performance.
In terms of investor sentiment, the market’s reception to the FY2024 results, combined with the ongoing Main Market transition and the RM78 million detention pond contract, will shape perceived growth prospects. While the reported numbers suggest improving fundamentals, investors will scrutinize how management translates these metrics into sustainable, long-term value. This includes evaluating the quality and diversity of the project backlog, potential dependence on a few large contracts, and the efficiency of working capital management given the elongated project cycles typical in infrastructure-related work. The broader market environment for construction and infrastructure plays a role as well, with macro factors such as interest rates, funding availability, and sector cycles influencing share price and capital allocation decisions.
Market Reaction, Valuation, and Shareholder Perspective
Trading activity around Southern Score’s stock has reflected a cautious stance from investors, with the company’s shares closing lower in the latest session after the contract announcement and the broader corporate transitions. The market capitalisation, calculated on the basis of the latest trading price and outstanding shares, sits around the RM1.21 billion range, underscoring a valuation that reflects both the company’s growth ambitions and the perceived risks associated with related-party transactions and the Main Market transition. A near-term price reaction—down by several sen in the session—could point to a combination of factors, including concerns about conflicts of interest, the scale and execution risk of the detention pond upgrade, and the strategic implications of expanding into a higher-regulation market environment.
From an investor-relations standpoint, the company’s performance in FY2024 remains a positive signal, particularly given the substantial revenue growth and a meaningful rise in net profit. However, the stock’s sensitivity to governance considerations will likely persist, especially in light of the related-party dynamic surrounding the Radium Development Bhd-linked Seribu Megah Sdn Bhd and the governing family’s involvement across both entities. Market participants may look for additional clarity on internal controls, independent oversight, and the steps management is taking to ensure that tendering, project selection, and contract terms are robust, transparent, and aligned with market norms for competitive procurement.
In the broader market context, the construction sector’s performance can be influenced by the level of public and private investment in infrastructure and real estate development. The detention-pond upgrade contract could be interpreted as a bellwether for local authority infrastructure projects and the capacity of private developers to collaborate with specialized construction firms to deliver critical urban drainage improvements. If Southern Score is able to secure a steady stream of similarly scaled projects, the combination of backlog growth and improved operational efficiency may help support a more favorable valuation premium as the company migrates to the Main Market and broadens its investor base. Conversely, execution risk on large projects, potential changes in regulatory requirements, or financing constraints could temper near-term upside and contribute to volatility in the stock’s price path.
Governance, Risk Management, and Operational Excellence
The presence of related-party elements in the contract arrangement calls for disciplined governance and stringent risk management practices. To uphold investor confidence, Southern Score should emphasize the independence and oversight provided by the board, including clear delineation of roles between management and the owners of Radium Development Bhd through Seribu Megah. Establishing a robust framework for tender evaluation, cost estimation, risk assessment, and change-order management is essential to ensure that project economics are transparent and defensible. Independent directors, audit committees, and internal controls should be actively involved in periodic reviews of project performance, cost variances, and milestone achievements to prevent conflicts of interest from influencing decision-making.
Additionally, the company can adopt best-practice governance measures, such as independent verification of project pricing, documented approvals for all major variations, and timely disclosure of any related-party transaction details that might affect stakeholder perceptions. Transparent communication around the project’s scope, pricing, and expected margins will be important to mitigate market concerns. As the company advances toward Main Market listing, strengthening governance infrastructure—risk management frameworks, compliance programs, and board composition—will be critical to meet heightened expectations from investors, lenders, and partners.
Operationally, Southern Score’s management team can focus on building a diversified project portfolio to reduce concentration risk associated with a single large contract. Achieving a balanced mix of public, private, and development-driven projects may help stabilize revenue streams and support sustainable profitability. Proactive management of working capital, particularly in the context of large-scale public infrastructure projects with lengthy payment cycles, will be important to ensure liquidity remains robust during project ramp-ups and when dealing with milestone-based cash receipts. The organization should also invest in project controls, progress tracking, and site safety programs, given the scale of detention-pond improvements and the complexities associated with urban drainage upgrades in a dense metropolitan environment like Kuala Lumpur.
Industry Context: Detention Ponds, Urban Drainage, and Kuala Lumpur Infrastructure
Detention ponds play a critical role in urban drainage systems, particularly in major metropolitan centers where heavy rainfall events and rapid urbanization converge to create flood risks and stormwater management challenges. Upgrading detention facilities can improve water retention capacity, reduce peak discharge during storm events, and support the city’s resilience against climate-related hydrological extremes. In the Kuala Lumpur context, such upgrades often involve coordination with multiple stakeholders, including municipal authorities, environmental agencies, and private sector developers. The execution of detention-pond projects involves considerations around slope stability, sediment control, water quality management, and compatibility with surrounding infrastructure. Contractors in this space typically bring together civil engineering, drainage system design, earthworks, and environmental protection expertise to deliver solutions that meet design specifications, regulatory standards, and performance criteria.
From an industry perspective, large detention-pond upgrades may be bundled with broader flood mitigation and drainage improvement initiatives, creating opportunities for integrated project delivery. For Southern Score, the RM78 million contract represents a meaningful engagement that may pave the way for additional similarly scoped projects within the region or in comparable urban contexts. The presence of Radium Development Bhd as a parent within the Seribu Megah ecosystem could facilitate access to development pipelines and potential collaborations on future drainage-related infrastructure projects. However, industry participants will also watch for competitive dynamics, including bidding by other established construction groups, price competition, and the capacity of local suppliers and subcontractors to meet project timelines and quality standards.
As Malaysia continues to advance urban development agendas, the construction sector’s growth trajectory could be influenced by policy decisions, public funding allocations, and private sector investment cycles. The Main Market transition will position Southern Score to engage with a wider base of institutional investors who monitor governance, risk, and strategic execution as critical drivers of long-term value. The detention-pond project, while specific in scope, also serves as a proxy for the company’s ability to manage complex civil works, coordinate with development partners, and execute projects that deliver tangible urban infrastructure enhancements.
Strategic Outlook: Growth, Pipelines, and Market Position
Looking ahead, Southern Score’s strategic trajectory hinges on several interrelated factors: project pipeline quality, execution proficiency, governance standards, and access to capital that supports larger, longer-duration contracts. The company’s FY2024 results suggest improving fundamentals that could provide a solid foundation for pursuing additional high-value projects. The Main Market transition is expected to deepen investor trust by elevating disclosure norms, governance expectations, and accountability, all of which can translate into broader financing options and more favorable terms with lenders and surety providers. A diversified project mix—encompassing detention pond upgrades, high-rise residential construction management, and other civil works—could help the company achieve more stable revenue streams while reducing exposure to any single contract’s performance risk.
Strategically, the alliance with Seribu Megah Sdn Bhd and Radium Development Bhd could serve as a conduit to broader development opportunities within Radium’s ecosystem. If the related-party framework is managed with robust governance practices and clear arm’s-length contract terms, this arrangement may yield synergies that accelerate project acquisition, enable more efficient procurement, and streamline on-site operations. Nevertheless, investors will expect continuous evidence that the company’s growth is not driven solely by related-party assignments but is anchored in competitive bidding, transparent tendering processes, and an expanding portfolio of independent contracts with varied clients. The company’s ability to demonstrate a healthy backlog, credible project execution, and disciplined cost management will be critical to sustaining a favorable market perception as it advances on its Main Market journey.
In terms of risk factors, execution risk on large and complex projects remains a central consideration. Any delays in the detention-pond upgrade or cost overruns could influence cash flows, profitability, and the company’s ability to meet milestones on other planned contracts. Regulatory shifts, changes in environmental standards, and intensifying competition within the construction sector could also shape the company’s strategic choices going forward. Management’s communication of risk mitigation strategies, contingency plans, and progress updates will be essential to maintaining investor confidence amid a dynamic market environment.
Operational Highlight: Management, Ownership, and Governance Nuances
The dynamics surrounding the MD’s family involvement across Radium Development Bhd create a nuanced governance landscape that warrants ongoing attention. While family-linked ownership structures can foster strong alignment of interests and streamlined decision-making, they can also raise concerns about governance independence and the potential for conflicts of interest. In this context, a well-functioning board with independent oversight, clearly defined delegation of authority, and transparent reporting is essential to ensuring that project awards, including the RM78 million detention pond upgrade, are evaluated and approved through objective processes. Management’s ability to separate strategic direction from individual or family interests will be closely watched by analysts and investors, who will expect robust disclosures regarding related-party interactions, procurement methodologies, and performance metrics.
The group’s anticipated Main Market listing further amplifies the importance of transparent governance practices. As reporting requirements become more stringent, Southern Score’s leadership must demonstrate consistent adherence to best practices in financial reporting, risk assessment, and stakeholder communications. The alignment between project execution capabilities and governance standards will influence the company’s access to capital, cost of funds, and the willingness of counterparties to engage in long-term collaborations. The market’s perception of governance quality will play a significant role in determining how the stock is valued as it transitions into a broader, more liquid market environment.
Conclusion
Southern Score Builders Bhd has secured a RM78 million detention-pond upgrade contract in Kuala Lumpur through its subsidiary, with Seribu Megah Sdn Bhd operating as a unit of Radium Development Bhd. The arrangement is notable for its related-party characteristics, given that the managing director’s siblings hold major stakes and directorships within Radium, which introduces governance considerations that stakeholders will monitor closely. The project spans a 12-month period, providing a defined horizon for revenue recognition and project delivery, while contributing to Southern Score’s strategic objective of advancing from the ACE Market to the Main Market of Bursa Malaysia. The group’s FY2024 results—net profit RM31.45 million and revenue RM170.72 million—underscore improving fundamentals and a trajectory of growth, supported by a strong performance in a year marked by significant revenue expansion.
Looking ahead, the company’s Main Market transition and its expanding project backlog could enhance access to capital, broaden investor engagement, and enable more ambitious project opportunities in the Malaysian construction sector. However, the related-party dimensions of the current contract necessitate vigilant governance practices, transparent disclosures, and independent oversight to ensure that the terms are fair, that procurement processes remain competitive, and that project execution meets the highest standards of efficiency and quality. If Southern Score continues to deliver on its strategic plan, maintain disciplined financial management, and strengthen governance frameworks, the group could strengthen its market position as a credible partner for large-scale infrastructure and high-rise construction management, while navigating the complexities inherent in a diversified family-linked corporate structure and a transition to a main-market listing.
