Sunway Healthcare Share Price Slips Following Johor Land Acquisition

KUALA LUMPUR, July 30 (Bernama) -- Sunway Healthcare Holding Bhd’s share price was down after its unit acquired four parcels of freehold land in Sunway City Iskandar Puteri, Johor, for RM45.37 million. 

At 10.45 am, Sunway Healthcare shares slipped one sen to RM1.91 with 1.95 million shares changing hands. 

The media reported that its 99.9 per cent-owned subsidiary Sunway Medical Centre Sdn Bhd (SMC) had entered into a sale and purchase agreement with Sunway Marketplace Sdn Bhd, Sunway Parkview Sdn Bhd, and Sunway Iskandar Sdn Bhd to acquire four land parcels, measuring a combined 4.01 hectares. 

The proposed development of the land will comprise a 410-bed hospital located within Sunway City Iskandar Puteri with an estimated total development cost of RM781.6 million.

Hong Leong Investment Bank Bhd (HLIB) viewed the acquisition positively, as it aligned with Sunway Healthcare’s long-term strategy to expand its network of tertiary hospitals and its footprint in Johor.

“The larger land parcel also provides the group with the option to further scale up its hospital over the longer term, as well as to develop senior living facilities.

“Construction is targeted for completion between 2030 and 2032,” it said in a note today.

HLIB added that with the proposed acquisition, it estimates net gearing will increase only marginally to 28.8 per cent in financial year 2027, up from 27.6 per cent currently.

“We do not expect any impact on the income statement during the construction phase, as borrowing costs will be capitalised,” it said.

HLIB has changed its “buy” call to “hold”, with the target price lowered from RM2.05 to RM1.92. 

-- BERNAMA