KIP-REIT’s second-half results likely to be stronger

PETALING JAYA: Strong financial performance of the existing property portfolio amidst continuous efforts to improve leasing and operational initiatives is expected of KIP Real Estate Investment Trust (KIP-REIT) going forward.

The anticipated finalisation of the KIPMall Kota Warisan acquisition is poised to enhance KIP-REIT’s future performance.

TA Research anticipates KIP-REIT financial results will be stronger in the second half underpinned by maiden earnings from the acquisition of KIPMall Kota Warisan, which is expected to be completed in the third quarter of financial year 2024 (3Q24).

It said KIP management is dedicated to prudent capital management, aiming to deliver sustainable returns to unitholders, and actively exploring growth opportunities in both retail and industrial assets.

TA Research maintained its “buy’’ recommendation on KIP-REIT with an unchanged target price of RM1.08 a share.

This is based on a target yield of 6.75% to its 2024 distribution per unit (DPU) projection of 7.3 sen per unit.

In the first half of this financial year (1H24), KIP-REIT posted a net profit of RM21mil (up 12.5% year-on-year or y-o-y), which came within the house’s expectations, accounting for 46% of its full-year forecast.

Its 2Q24 DPU stood at 1.55 sen per unit, bringing 1H24 DPU to 3.1 sen a unit (plus 6.9% y-o-y).

Based on the last closing price, this works out to an annualised dividend yield of 7%, the research house said.

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