KUALA LUMPUR, Sept 8 (Bernama) -- Bursa Malaysia closed almost flat on Tuesday as buying interest rotated away from index heavyweights towards smaller-cap construction stocks, with sentiment affected by geopolitical uncertainty, said an analyst. At 5 pm, the FTSE Bursa Malaysia KLCI (FBM KLCI) eased 0.39 of a point to 1,714.40 from Monday’s close of 1,714.79. The benchmark index opened 1.65 points lower at 1,713.14 and moved between 1,710.44 and 1,714.50 throughout the trading session. The broader market was almost evenly balanced, with decliners leading gainers 548 to 546, while 598 counters were unchanged, 1,107 were untraded and 25 were suspended. Turnover expanded to 4.13 billion units valued at RM3.14 billion from 3.60 billion units valued at RM2.45 billion on Monday.
CGS International (CGSI) analysts Natalie Ong and Lock Mun Yee have lowered their target price for Mapletree Pan Asia Commercial Trust (MPACT) to $1.58, down from $1.59. This adjustment follows a slower-than-expected recovery of Festival Walk mall in Hong Kong.
Key Takeaways:
• Target Price Reduction: The target price was reduced by one cent due to the underperformance of Festival Walk mall.
• Decline in Sales: Hong Kong sales value dropped 6.1% year-on-year as of May 2024, affecting various sectors.
• Revised Forecasts: CGSI revised their FY2024 Hong Kong retail growth forecast to a 6.0% decline from an earlier 3.0% increase.
Key Risks:
• Local Spending Shifts: The decline in local consumer spending and less upside from tourist arrivals.
• Potential Negative Reversions: Some leases at Festival Walk may face negative rent reversions.
Conclusion:
Despite the challenges, MPACT’s high occupancy rate at Festival Walk and its attractive FY2024 distribution per unit (DPU) yield of 7.1% remain positive factors. However, the slower recovery and potential negative impacts on rents have been factored into the reduced target price.
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