PETALING JAYA: A stronger earnings run could be ahead for Sime Darby Property Bhd
(SimeProp) in the second half of financial year 2026 (2H26), as data centre contributions kick in more fully and progress billings accelerate.
Following a 4.8% year-on-year increase in normalised net profit to RM270.4mil in the first six months, TA Research said 2H earnings “should be stronger” and that the first-half results were in line with expectations.
BIMB Research, which also expects an improved bottom line, said it would also be supported by a back-loaded launch pipeline.
SimeProp is planning to launch RM2.7bil worth of properties in 2H26, larger than the 1H’s RM2bil.
“Management maintained its RM4bil sales target and RM4.7bil launch plan, supported by RM3.8bil unbilled sales and RM1bil bookings as at Aug 9,” said BIMB Research. “Industrial segment is still a key earnings driver, while recurring income continues to scale with assets under management (AUM) at about RM5bil.”
The RM5bil was achieved following the injection of two assets based in E-Metro Logistics Park in Bandar Bukit Raja – Metrohub 4 and Metrohub 3.
Metrohub 4 has been completed and the groundbreaking ceremony for Metrohub 3 took place in July. By 2028, SimeProp aims to lift the AUM to RM10bil.
Meanwhile, CIMB Research noted that Sime Darby Property has been actively replenishing its land bank to strengthen its future property development pipeline.
After buying Wisma UniRazak for RM160mil in July 2026, the group moved quickly to acquire a prime land bank in Kulai for RM419mil from SD Guthrie Bhd on Aug 11, 2026.
“Despite a challenging operating environment, we retain our buy recommendation on Sime Darby Property with an unchanged target price of RM1.72, underpinned by its integrated property business model and renewed commitment to pay higher dividends,” said CIMB Research.
BIMB Research also has a “buy” call but lowered its target price from RM1.79 to RM1.64.
“The lower target price reflects our earnings cuts and slower core earnings conversion. SimeProp’s valuation is already near the upper end of its historical range.”
This further limits re-rating upside despite support from its growing recurring-income base and healthy balance sheet.
Based on Bloomberg data, all three research houses that cover Sime Darby Property have a “buy” call on the stock.
