CIMB Securities maintained its OVERWEIGHT call on the healthcare sector, with KPJ Healthcare Bhd remaining its top sector pick, as the research house said the Public Accounts Committee (PAC) report on healthcare costs supports ongoing reform efforts rather than introducing major new measures. CIMB also retained BUY calls on KPJ Healthcare, IHH Healthcare Bhd and Duopharma Biotech Bhd.
The research house said the PAC’s 17 recommendations, outlined in its 1,999-page report, are largely aligned with the RESET framework introduced in 2025 by the Joint Ministerial Committee on Private Healthcare Costs (JBMKKS). CIMB noted that both initiatives aim to address rising healthcare costs while ensuring the long-term sustainability of Malaysia’s private healthcare ecosystem.
CIMB said the relationship between private hospitals and insurers remains symbiotic, with both parties relying on each other to maintain a sustainable healthcare system. The research house added that while some PAC recommendations are not explicitly covered under RESET, they are broadly aligned with the programme’s objectives and could strengthen ongoing reforms.
The research house said policy execution will be key, as measures such as hospital charge caps and medicine price regulations will depend on decisions by relevant ministries and regulators. CIMB highlighted the rollout of the MediAsas MHIT plan and the phased implementation of the Diagnosis-Related Group (DRG) payment system as signs of a more consultative approach to improving healthcare affordability and insurance penetration.
CIMB expects KPJ Healthcare and Sunway Healthcare to benefit from stronger patient volumes due to their higher exposure to the domestic market, while IHH Healthcare is expected to face limited impact as Malaysia contributes only 23% of its group EBITDA. CIMB maintained its BUY call on KPJ with a target price of RM4.09, IHH at RM10.30 and Duopharma Biotech at RM1.83.
