Hong Leong Investment Bank Bhd (HLIB) has maintained its HOLD call on KLCCP Stapled Group Bhd, raising the target price to RM8.32 from RM7.90, reflecting a balanced risk-reward profile.<\/p>\n
Analysts noted that the group\u2019s 3Q25 results were largely in line with expectations, underpinned by sustained performance across its retail and hotel segments, while near-term positives are broadly priced in.<\/p>\n
KLCC posted 3Q25 core net profit of RM209.1 million, up 4.3% quarter-on-quarter and 1.3% year-on-year, bringing 9M25 earnings to RM611.1 million, within 73% of HLIB\u2019s full-year forecast and 72% of consensus. A quarterly dividend of 9.5 sen per share was declared, raising total dividends for 9M25 to 27.9 sen, slightly higher than 27.4 sen in the same period last year.<\/p>\n
Revenue in 3Q25 rose 4.7% quarter-on-quarter, largely driven by an 18.2% gain in the hotel segment. Retail revenue expanded moderately by 2.9%, while office income remained flat. Year-on-year, overall turnover was relatively steady, with minor declines in retail (-1.9%) and hotel (-5.6%), offset by 5.2% growth in management services.<\/p>\n
Lower finance costs, down 5.7%, helped lift core PATAMI by 1.3% year-on-year despite a slight increase in debt-related interest from the 40% acquisition of Suria KLCC in 2Q24.<\/p>\n
Occupancy rates remained robust, with retail at 98% and office at 100%, while the group\u2019s gearing held steady at 32%. Analysts highlighted that these stable metrics support the group\u2019s consistent earnings generation and underpin its ability to maintain dividends.<\/p>\n
Looking ahead, footfall at Suria KLCC is expected to remain strong through 4Q25, while Mandarin Oriental is projected to maintain firmer occupancy, aided by festive season and holiday-driven spending.<\/p>\n
For 2026, tourism initiatives including Visit Malaysia 2026 and the Malaysia\u2013China mutual visa exemption are expected to bolster both the retail and hotel segments, particularly with a rebound in Chinese visitors.<\/p>\n
HLIB noted that although these factors provide upside potential, they are largely reflected in the current share price, resulting in a balanced risk-reward.<\/p>\n
The HOLD rating is supported by a rolled-forward FY26 dividend per unit, targeting a yield of 5.3%, benchmarked against the five-year mean spread versus the Malaysia Government 10-year bond.<\/p>\n
Analysts expect low single-digit growth in the near term, with the group\u2019s core earnings underpinned by continued tourism and retail recovery.<\/p>\n