Hong Leong Investment Bank Bhd (HLIB) has upgraded UEM Sunrise Bhd to BUY from HOLD, accompanied by a higher target price of RM0.90, up from the previous RM0.56.
The research house maintains its forecasts, anticipating a strategic reset under the new management to unlock value from its Johor landbank through monetisation, joint ventures and increased launches.
The analysts said the group is shifting towards a more pragmatic execution focused strategy under its new chief executive, Shaharul Farez, with clearer priorities on unlocking value from its sizeable landbank, expanding recurring income and improving shareholder returns.
They added that sentiment has already been weighed down by prior execution delays, suggesting much of the downside is reflected in the current share price.
They noted UEM Sunrise is targeting up to RM4 billion in potential land sale proceeds from about 1,000 acres in Gerbang Nusajaya, which they view as a near term catalyst.
The group is also planning to lift Johor launches to RM1 billion in FY26 and RM1.5 billion in FY27, alongside a maiden industrial launch at Gerbang Nusajaya Industrial Park by 1Q27.
Beyond Johor, analysts highlighted the Angkasa Raya site in Kuala Lumpur as a highly strategic asset opposite KLCC with a potential gross development value of about RM2 billion, depending on development assumptions and market interest.
They added that expansion of property investment assets from RM770 million to RM1.5 billion and asset enhancement initiatives across Kiara Bay, Publika and Puteri Harbour could support recurring income growth.
Management is also targeting a higher dividend payout beyond the current 40% to 60% policy, which analysts said could strengthen shareholder returns.
The research house said earnings are expected to be supported by key Central region projects including The Minh, Connaught One and Residensi Zig, with FY26 launches of RM2.2 billion and potential FY27 launches exceeding RM3 billion.
Analysts said the stock could re-rate further if execution improves, particularly on land monetisation and launch delivery.
As of 10.27 am, the stock price gained 3.64% to RM0.57.
