PETALING JAYA: KIP Real Estate Investment Trust
(KIP-REIT) is poised for steady growth over the medium term, according to TA Research and Apex Securities Research.
The outlook is underpinned by resilient necessity-driven demand, active asset management, and a pipeline of acquisitions and asset enhancement initiatives.
TA Research said KIP-REIT’s management has maintained its financial year ending June 30, 2026 (FY26), rental reversion guidance at 5% to 7%, supported by “steady necessity-based demand, tenant remixing and festive period footfall”.
It added that gross turnover (GTO) rent remained a pocket of upside, contributing about 3.5% of total revenue.
Portfolio occupancy also edged higher to 98.5% in the third quarter of FY26 from 98.2% in the preceding quarter, reflecting sustained demand across retail and industrial assets.
The research house noted that the trust’s community-centric positioning continues to anchor footfall.
“Management continues to position its malls as one-stop community-centric malls curated for the mass market, which supports resilient necessity-driven footfall.”
Following the completion of KIPMall Tampoi’s asset enhancement initiative (AEI) in February 2026, management is now focusing on further AEIs at KIPMall Masai, KIPMall Kota Warisan and AEON Mall Kinta City to sharpen leasing, drive rental reversions and keep assets relevant to evolving consumer needs.
“KIP-REIT remains our top pick in the REIT sector, underpinned by its above sector yield, defensive community mall portfolio and visible growth from AEIs, and the proposed Setapak Central Mall acquisition,” TA Research said.
The research house maintained a “buy” call, raising its target price to RM1.13 from RM1.12, after increasing its target yield to 6.75%.
Apex Securities similarly expects stable earnings, supported by expansion and operational improvements.
“KIP-REIT’s earnings outlook remains stable, supported by value-accretive acquisitions and AEI at KIPMall Tampoi,” the brokerage further said.
The research house highlighted that the enlarged portfolio could reach RM2.1bil in assets under management, surpassing earlier targets.
“Footfall across the retail segment is likely to remain resilient despite ongoing Middle East tensions and elevated crude oil prices,” Apex Securities said.
It also expects the revamped KIPMall Tampoi to drive growth, citing a 5% to 10% rental upside from higher car park income and GTO-based tenancy structures.
Apex Securities upgraded the stock to “buy” from “hold”, although it trimmed its target price to 92 sen from 95 sen, reflecting a higher required yield of 7.75% amid tax changes.
