KLCCP Stapled Group rose to the No. 2 spot among Bursa Malaysia’s top gainers on Monday, closing 1.95% higher at RM8.87, supported by strong investor interest despite analysts maintaining neutral calls.

As of 4.05 pm, the stock gained 17 sen with a volume of 578,300 shares traded, touching an intraday high of RM8.90. The rise comes on the back of a solid first quarter showing, where KLCCP reported a 7.2% year-on-year growth in core net profit to RM201.5 million, in line with expectations.

RHB Investment Bank Bhd (RHB Research), MIDF Amanah Investment Bank Bhd (MIDF Research) and Hong Leong Investment Bank Bhd (HLIB) all reiterated their ‘Neutral’ or ‘Hold’ calls, with target prices ranging from RM7.71 to RM8.52, citing limited upside despite stable earnings and robust fundamentals. KLCCP declared a 9.2 sen distribution per stapled security, up from 9.0 sen last year.

Positive rental reversions in the retail segment and the recent acquisition of the remaining 40% stake in Suria KLCC helped lift earnings, with RHB noting a healthy 32% gearing and declining debt costs due to fixed-rate borrowings.

MIDF Research highlighted that stronger retail contributions during the festive period offset weaker results in hotel and management services, which were affected by low Ramadan occupancy and ongoing ballroom upgrades at Mandarin Oriental Kuala Lumpur.

HLIB expects recovery ahead, boosted by tourism momentum and the full-year contribution from Suria KLCC. However, it maintained a cautious outlook due to subdued topline growth and rising finance costs.

Retail and office occupancy remained strong at 99% and 100% respectively, while hotel occupancy dipped to 54%. Analysts expect mid-single digit rental reversions and an uptick in office rates, with hotel earnings likely to rebound post-upgrades.

Despite the neutral stance from brokerages, Monday’s price rally signals investor confidence in the group’s long-term outlook, underpinned by stable recurring income and potential for inorganic growth.

Source: Today’s Shares: KLCC Climbs 1.95%, DPS Raised To 9.2 Sen – BusinessToday