PETALING JAYA: IOI Properties Group Bhd
’s upcoming real estate investment trust (REIT) listing may be the next catalyst for share price re-rating, even after a 17% year-to-date rise.
The group has two REIT listings in Malaysia and Singapore with the Malaysian listing targeted for June 2026, according to UOB Kay Hian Research.
Assessing the incremental valuation upside by using a sum-of-the-parts framework, the research house estimated a further upside of 9% to 16% upside to IOI Properties share price, underpinned by continued yield compression among prime REIT players in Malaysia.
“Our calculation assumes an asset value of RM7bil and a target valuation of 1.5 times price-to-book (P/B) for the REIT, broadly in line with peers with prime retail assets, alongside a retained stake of 60% to 70%,” the research house said in a report.
It said post-listing, the property group’s net gearing could improve to 0.91 times to 0.94 times (from 0.97 times) as of end of the first quarter of its financial year 2026 (FY26) while implied FY26 P/B is higher at 0.9 times from 0.7 times.
The research house has a RM3.50 target price for IOI Properties.
Among the more bullish research houses, Hong Leong Investment Bank has a RM4.15 target price on IOI Properties, noting in its November report that the stock offers investors a diversified market exposure with notable presence in Singapore, and China, besides Malaysia.
A dealer said the rally reflected the market’s increasing recognition of IOI Properties’ expanding recurring income base and its longer-term REIT monetisation potential.
“In the past one year, shares of IOI Properties rallied 50% as investors rerate the stock on strong overseas earnings momentum and expanding recurring income, reinforced by robust earnings.,” he added.
At the time of writing, its share price was trading at the RM3.10 levels.
