AU
CA
NZ
UK
US
IND
This report is an updated version of the report published on 3 July 2025 at 1:27 PM AEST
Company Overview
Company Overview: Duratec Limited (ASX: DUR) is an Australia-based contractor providing assessment, protection, remediation, and refurbishment services to a range of assets and infrastructure. Its multidisciplined capabilities combine engineering experience with project delivery expertise and use a range of in-house assessment technologies, including 3D capture and modelling technology with predictive analysis tools. Acrow Limited (ASX: ACF) is a provider of smart integrated construction systems across formwork, industrial services and commercial scaffolding in Australia. The company's portfolio is falsework and shoring, screen solutions, Jacking Systems (Jumpform), and internal engineering capabilities. Kalkine’s Sector Report covers the Investment Summary, Sector Overview & Supporting Catalysts, Data Insights & Analysis, Financial Metrics, Financial Commentary, Risks, Outlook, Technical Analysis along with the Valuation, Target Price, and Recommendation on selected stocks.
Investment Summary
Sector Overview and Supporting Drivers
Australia’s construction sector is a vital pillar of the economy, encompassing residential, commercial, and infrastructure development. It contributes significantly to employment and GDP, driven by population growth, urbanisation, and government infrastructure investment. The sector is recently experiencing a surge in demand, particularly in housing and civil projects, but faces challenges such as labour shortages, cost inflation, and supply chain disruptions. Long-term growth is supported by migration-led housing demand, decarbonisation initiatives, and digital transformation. While economic cycles and interest rate fluctuations influence activity levels, the sector’s resilience is underpinned by structural drivers and continued public and private sector investments.
Sector Catalysts
Index Performance
Investment theme and stocks under discussion (DUR, ACF)
After understanding the sectors, let us now look at two companies from the Construction sector listed on the ASX. The price potential of the companies under discussion have been analysed based on Price/Cash Flow Per Share based relative valuation methods.
1. ASX: DUR (Duratec Limited)
(Recommendation: ‘Speculative Buy’ at AUD 1.430; Potential Upside: Low Double-Digit; MCap: AUD 363.44mn)
DUR is an Australia-based contractor providing assessment, protection, remediation, and refurbishment services to a range of assets and infrastructure. Its multidisciplined capabilities combine engineering experience with project delivery expertise and use a range of in-house assessment technologies, including 3D capture and modelling technology with predictive analysis tools.
The stock has declined by ~3.04% in last one month, and over the past six months, it has corrected by ~2.40%. The stock has a 52-week low and 52-week high of AUD 1.115 and AUD 1.780, respectively and is currently trading close to its 52-week high-low average. DUR was last covered in a report dated ‘11 October 2024’.
2. ASX: ACF (Acrow Limited)
(Recommendation: ‘Speculative Buy’ at AUD 0.975; Potential Upside: Low Double-Digit; MCap: AUD 300.25mn)
ACF is a provider of smart integrated construction systems across formwork, industrial services and commercial scaffolding in Australia. The company's portfolio is falsework and shoring, screen solutions, Jacking Systems (Jumpform), and internal engineering capabilities.
The stock has witnessed a correction of ~3.52% in last one month, and over the past six months, it has declined by ~10.71%. The stock has a 52-week low and 52-week high of AUD 0.915 and AUD 1.195, respectively and is currently trading below the 52-week high-low average. ACF was last covered in a report dated ‘23 January 2025’.
Markets are trading in a highly volatile zone currently due to certain macro-economic issues and geopolitical tensions prevailing. Therefore, it is prudent to follow a cautious approach while investing.
Note 1: Past performance is neither an Indicator nor a guarantee of future performance.
Note 2: The reference date for all price data, currency, technical indicators, support, and resistance levels is 3 July 2025. The reference data in this report has been partly sourced from REFINITIV.
Note 3: Investment decisions should be made depending on an individual’s appetite for upside potential, risks, holding duration, and any previous holdings. An ‘Exit’ from the stock can be considered if the Target Price mentioned as per the Valuation and or the technical levels provided has been achieved and is subject to the factors discussed above.
Note 4: Kalkine reports are prepared based on the stock prices captured either from REFINITIV or Trading View. Typically, REFINITIV or Trading View may reflect stock prices with a delay which could be a lag of 25-30 minutes. There can be no assurance that future results or events will be consistent with the information provided in the report. The information is subject to change without any prior notice.
Technical Indicators Defined: -
Support: A level at which the stock prices tend to find support if they are falling, and a downtrend may take a pause backed by demand or buying interest. Support 1 refers to the nearby support level for the stock and if the price breaches the level, then Support 2 may act as the crucial support level for the stock.
Resistance: A level at which the stock prices tend to find resistance when they are rising, and an uptrend may take a pause due to profit booking or selling interest. Resistance 1 refers to the nearby resistance level for the stock and if the price surpasses the level, then Resistance 2 may act as the crucial resistance level for the stock.
Stop-loss: It is a level to protect further losses in case of unfavourable movement in the stock prices.
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Past performance is not a reliable indicator of future performance.
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