KPJ - Hospital Prince In Malaysia

KPJ - Hospital Prince In Malaysia

Background:

KPJ Healthcare Berhad provides private healthcare services. The group has assets in the form of hospitals and retirement centers in Malaysia, Indonesia, Thailand, Bangladesh, and Australia. KPJ's operations include a variety of surgical disciplines, medical specialties, and hospital clinical services & facilities. 



Catalyst:

1. Maybank Investment Bank (IB) Research expects KPJ Healthcare Bhd’s earnings outlook to remain resilient, underpinned by expected volume recovery in the second half of the year, rising case complexity and cost optimisation efforts.

2. The research house viewed KPJ’s asset monetisation and lease renewal exercise as a strategic effort to unlock capital and support its 6,000-bed target by 2030. KPJ recently launched a 60-bed hospital in Kuala Selangor as part of its organic expansion.


3. Alongside five other hospitals under gestation (four are earnings before interest, taxes, depreciation, and amortisation or ebitda positive), this could pose near-term earnings upside.

4. Private healthcare sector to book stronger numbers on a quarter-on-quarter basis in the second quarter of 2025, due to the shorter festive period.

5. KPJ Healthcare Bhd is focusing on boosting its medical tourism segment, with a strong focus on attracting patients from Indonesia. Malaysia Healthcare Travel Council, more than 40 per cent of those Indonesian patients (54 million) are coming to Malaysia.


Risk

The implementation of the diagnosis-related group (DRG) payment model in Malaysia is structurally negative for hospital operators due to its potential downward pressure on margins and hospitality, but the near-term impact will be minimal as the initial rollout will be confined to lower-value, lower-margin cases, like minor and mainstream illnesses. The rollout will begin at selected public hospitals. The first phase, which will focus on minor illnesses, is to be implemented by the end of this year. 



Technical Analysis

EP 2.72-2.75
SP 2.60
RST 2.82

TP 1 2.85
TP 2 2.95
TP 3 3.04

Holding period: 6 months


a) Break downtrend line
b) Price above MA20, 50, 100 & 200
c) MA20 & MA50 stay above MA200
d) ADX, RSI and Stoschastic pointing up
e) MACD cross up and above 0 central line

Disclaimer : The above opinion is never intended to be a BUY SELL CALL. The above article purely for education purpose base on observations, chart and data. Thank you.

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