KUALA LUMPUR: IOI Properties Group Bhd’s second-half earnings this year are expected to come in stronger as new projects are progressively rolled out in the coming months, said RHB Research Sdn Bhd.
The bank-backed research firm said it expects IOI Properties’ new sales to pick up in the upcoming quarters, especially from the Klang Valley region as Bandar Puteri Bangi is slated for launch in the second quarter of next year.
Phase 1 of Bandar Puteri Bangi project comprises terrace homes and commercial shops with a gross development value (GDV) of RM600 million.
“With this and other ongoing projects, we believe IOI Properties will be able to hit RM2 billion sales next year,” RHB Research said in its note yesterday.
IOI Properties also had a soft opening of IOI City Mall last weekend.
RHB Research said the mall will likely contribute to earnings only from 2016 as some rebates and discounts in rentals, and a period of fit-out can be expected in the first six months of opening.
The mall is already 90 per cent leased.
IOI Properties reported a lower first-quarter net profit of RM101 million in the financial period ending September 30 2015 compared with RM111.06 million in the same quarter last year. Its revenue, however, rose to RM375.52 million from RM280.61 million a year ago.
The company’s first-quarter 2015 earnings came in below RHB Research and the market’s expectations.
However, the research firm does not think it is a major concern as the first quarter of this year was also the weakest quarter this year in terms of the topline.
RHB Research has maintained its “buy” call on IOI Properties, with a target price of RM3.10.
~ By BUSINESS TIMES
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