KUALA LUMPUR: Hong Leong Investment Bank (HLIB) Research has reiterated its bullish view on Sunway Bhd
following an encouraging start to its financial year and expansion plans over the coming year.
According to the research firm, Sunway is scaling up growth through more launches in property development and expanding its hospital capacity.
"The group has multi levers of growth, particularly with its fast expanding crown jewel, healthcare segment.
"Sunway remains our top pick given its synergistic business model with well-integrated property, construction and building material operations," it said.
It added that investors could gain early exposure to its healthcare segment prior to its value unlocking exercise through an initial public offering (IPO) listing.
"The segment at this juncture continues to be undervalued but we believe it should be re-rated in due time as it increasingly draw investor’s focus given strong healthcare demand and as the earnings from this segment filters through."
HLIB, which has a "buy" call and target price of RM2.65 on Sunway, said the group's performance in the first quarter of 2023 were within expectations
It said Sunway reported a core profit after tax and minority interests (Patami) of RM141.8mil, which was within its and consensus expectations.
The result came to 23.4% of HLIB's and 21.4% of market full-year forecasts.
"Post annual report update, we tweaked our FY23/24 forecasts by -1.8%/+1.5% and we introduce FY25 forecast," it said.
