KPJ Healthcare Berhad (KPJ) has focused on optimising existing resources to boost its bed utilisation rate while seeking new merger and acquisition opportunities, according to a report by MIDF Amanah Investment Bank (MIDF).
The hospital group's bed occupancy rate (BOR) reached 60% in 1QCY24, nearing the full-year rate of CY23. It aims to increase its bed count by around 400 by the end of CY24, capitalising on expansions in its Malaysian hospitals and rising demand for healthcare services.
MIDF maintains its BUY recommendation on KPJ, with an unchanged target price of RM2.54. The bank views the group's strategy to optimise current assets as cost-efficient and timely given the strong performance in healthcare tourism, which contributes around 5%-6% of its total business.
Despite potential challenges such as ageing infrastructure and limited scalability, MIDF believes KPJ is well-positioned to manage these risks effectively. The group's approach aligns with its 5-Year Strategic Plan, ensuring a balanced path forward.
