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Strong growth expected in the second half of the year. IOI Properties embarks on a new chapter 2.0.
Strong growth expected in the second half of the year for IOI Properties, opening a new chapter 2.0.
IOI Properties $IOIPG (5249.MY)$ Currently firing on all cylinders, driving occupancy rates in Singapore's industrial projects. However, analysts point out that the company's overall performance in the first half of 2025 will be weak, but a major turnaround is expected in the second half of the year, therefore remaining bullish on the company's performance.
Analysts at Fung & Long Investment Bank pointed out that the slight decline in performance in the first half of the year was mainly due to the initial losses of Singapore's IOI Central Boulevard (IOICB).
However, with the improvement in the rental rates of The South Beach and IOICB in Singapore, coupled with increasing contributions from land sales and the initial high performance of Marina View Residences (MVR), it is expected to drive a strong rebound in overall performance in the second half of the year.
In addition, analysts also indicated that the hotel business is expected to rebound, and renovation projects are progressing well, believed to be one of the major contributors.
Furthermore, the company intends to launch properties and projects worth over 14 billion Ringgit in the 2025 fiscal year, with projects in Malaysia accounting for 2 billion Ringgit and projects in Singapore accounting for the remaining 12 billion Ringgit, setting a historical record for Malaysian developers.
Analysts also observed a more proactive trend in the company's launch of Malaysian projects, as they introduced products worth 1.7 billion ringgit in the fourth quarter of the 2024 fiscal year, believing that the momentum will continue and may even exceed the set target of 2 billion ringgit.
Datacenter incentive land sale
On the other hand, the company recently launched the IOI Industrial Park series and received inquiries from data center participants, which may boost land sales as the current prices of relevant land are quite attractive.
Given the company's active capital global strategy, any income can be effectively used to reduce the debt ratio or redeployed for future expansion.
Looking back at the overall performance of the company, in recent years, IOI Properties has transformed by increasing commercial land and hotel business.
During the period from 2020 to 2025, the company's shopping malls and office buildings are expected to increase by 115% and 60% respectively, while hotel room capacity will increase by 64%. These assets are expected to start generating income in the current and next fiscal year, kicking off a new chapter for IOI Properties 2.0.
In general, analysts continue to maintain a "buy" rating with a target price of 4.05 ringgit unchanged.
Source: Nanyang Siang Pau
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