KUALA LUMPUR: A promising end to the year for KLCCP Stapled Group bodes well for its outlook in 2024 as the performance of its business segments are only expected to improve moving forward.
In its post-results review, Hong Leong Investment Bank (HLIB) Research said the hotel segment stayed in the spotlight as it remained in the black from 3Q23 amid improving tourist arrivals.
"This has helped with the retail segment’s performance as well, with tenancy sales reaching the highest ever in this quarter," it said.
With tourist arrivals expected to continue to improve, HLIB said the hotel and retail segments are expected to sustain their strong performance.
In addition, the retail segment could see a boost to its performance from 3Q24 onwards should Suria KLCC's acquisition be completed within the expected timeframe and the group realises full contribution from the mall's earnings.
HLIB also noted that earnings in subsequent quarters will be sustained by the office segment's stable occupancy rates as well as steady performance form the facilities management segment.
The research firm has a "hold" recommendation on KLCCP with an unchanged target price of RM6.89 as it said the positives have been priced in at current dividend yields of 5.4-5.6%.
Meanwhile, Kenanga Research said KLCCP's businesses have surpassed pre-pandemic levels with improvements in their respective occupancy rates.
"Concurrently, the group has expressed interest in exploring global assets to add to its portfolio but prioritising the enhancement of local operations, while also considering venturing into the healthcare sector," it said in its own review.
Kenanga has recommended an "outperform" call on KLCCP while raising its target price to RM8 from RM7.31 previously.
