UEM Sunrise Bhd remains a BUY with no change to target price at RM0.92 and RM0.83 respectively as Hong Leong Investment Bank Bhd (HLIB) and CIMB Investment Bank Bhd (CIMB Securities) both maintained their positive calls following the group’s development rights agreement with EXSIM Development to unlock value from its prime Kuala Lumpur land.
HLIB and CIMB Securities analysts said the deal is expected to generate a guaranteed entitlement of RM415 million alongside potential profit-sharing upside, with estimated FY26 net gains of about RM66 million.
UEM Sunrise has entered into a development rights agreement covering its 1.59-acre Jalan Ampang land, which will be developed into a mixed-use project comprising a hotel, hotel residences and a retail mall subject to approvals. Under the structure, RM41.5 million or 10% of the guaranteed entitlement was paid on 26 June 2026, RM62.3 million or 15% was received on 3 July 2026 and the remaining RM311.3 million will be payable within three months with a possible extension of up to two months, accruing 8% interest per annum on late payment.
Beyond the guaranteed proceeds, analysts highlighted a profit-sharing mechanism where UEM Sunrise will receive 10% of any pre-tax profit above RM610 million, providing additional upside exposure if the project performs strongly. CIMB Securities noted that the guaranteed entitlement alone could contribute about RM66 million in FY26 net profit, equivalent to 59% of its FY26 core earnings forecast.
Both research houses viewed the deal as a capital-light value unlocking exercise that reduces development risk while enabling immediate cash realisation. HLIB said the structure allows UEM Sunrise to avoid sizeable execution risk associated with developing a project of this scale independently, while CIMB Securities said it strengthens earnings visibility and supports near-term profitability.
Analysts added that the transaction reflects improving sentiment in the high-end Kuala Lumpur property segment, with demand for prime city land supporting monetisation opportunities. UEM Sunrise’s broader pipeline, including projects in Mont Kiara, Kelana Jaya and Puteri Harbour, is also expected to support longer-term growth momentum.
The stock remains underpinned by a strategic reset narrative under new leadership, with analysts pointing to recent execution milestones and asset monetisation efforts as early signs of improved delivery and sharper capital allocation.
As of 11.51 am, the stock price gained 6.72% to RM0.635.
