PETALING JAYA: The market should expect more aggressive efforts by Sime Darby Property Bhd
(SDP) to accumulate more industrial property assets and, at the same time, roll out new industrial park projects, says RHB Research.
The research house has maintained a “buy” call on the stock with an unchanged target price of RM2.33 following a recent non-deal roadshow it organised for the company’s senior management team that met 20 fund managers, noting that many were upbeat with the team’s commitment to build a solid industrial property portfolio over the next two to three years.
“A fund management platform and asset recycling exercise will potentially be the avenue to house investment property assets over the medium term.”
The company may even partner with SD Guthrie Bhd, a major landowner, for industrial and township projects in Iskandar Malaysia in Johor and Malaysian Vision Valley 2.0 (MVV 2.0) in Negri Sembilan.
The company “is actively looking for new land to enhance its landbank exposure, which is currently very much concentrated along Selangor’s western corridor” while the partnership with SD Guthrie could be a potential re-rating catalyst.
SDP has three industrial projects in the pipeline located in MVV 2.0, which has been launched, as well as a business park in Bandar Bukit Raja and Elmina North, both located in Selangor.
“These three projects are set to drive SDP’s industrial property sales from 2026 onwards. Interest has been strong despite the unfriendly trade policies imposed by the US government.
“Apart from the usual multinationals from Europe, management recently received more demand from Chinese manufacturers to set up plants at its industrial parks, with lease arrangements and buy-back options,” it noted.
The company’s management also shared that there would be spending on flood mitigation measures and other environmental, social and governance features for the Bandar Bukit Raja business park, with the pricing of land parcels and factories at a slight premium to an earlier phase to continue attracting demand due to good infrastructure.