Sunway Healthcare’s listing may happen sooner

PETALING JAYA: The strong performance of all the Sunway hospitals may help to accelerate the timing of the listing of Sunway Healthcare Group (SHG), which is estimated to be worth RM9bil.

RHB Research has advised investors to start accumulating Sunway Bhd as investors are expected to be rewarded by the value-unlocking exercise, similar to the listing of Sunway Construction Group Bhd (SCGB) eight years ago.

“During the listing of SCGB, Sunway’s shareholders were entitled to a one-for-10 distribution-in-specie of free SCGB shares and post-listing, shareholders also received a 26-sen special dividend. We expect Sunway’s shareholders to be rewarded similarly via the value-unlocking exercise,” it added.

The research house has maintained a “buy” call, with a new target price of RM3 from RM2.65 previously, representing a 35% upside and 3% yield.

“Performance of newer hospitals, especially Sunway Medical Centre Penang is better than expected.

“The hospital’s earnings before interest, tax, depreciation and amortisation (ebitda) has already turned positive since 2Q23 considering that it only opened in November 2022,” the research house added.

The research house expected the hospital to start turning a profit at the pretax-profit level in the second half of this year.

“Under the shareholders’ agreement with Singapore’s sovereign wealth fund GIC Pte Ltd, the initial public offering for SHG has to be completed by October 2027. We expect the listing to happen sooner,” it added.

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