IHH Shares Up After Posting Higher 2Q FY2024 Results

KUALA LUMPUR, Aug 30 (Bernama) -- Shares of IHH Healthcare Bhd rose early Friday after posting higher second quarter 2024 (2Q FY2024) financial results which exceeded analysts’ estimates.

At 10.24 am, IHH's shares were up by one sen to RM6.30, with 418,300 shares traded.

Its 2Q FY2024 net profit doubled to RM623 million against RM301 million in 2Q FY2023, boosted by strong operational performance, the positive impact from deferred tax credits and net monetary gains from MFRS 129 accounting policies application.

Its revenue also advanced by 30 per cent to RM6.09 billion from RM4.67 billion in 2Q FY2023, driven by sustained demand for quality healthcare services, a case mix of more acute patients and price adjustments to counter inflation.

Hong Leong Investment Bank Bhd (HLIB) has maintained its positive outlook on the healthcare provider for its resilience in a defensive sector; it is strategically positioned to capitalise on global megatrends, particularly an ageing population.

The investment bank said it is keeping IHH's full FY2024/FY2025/FY2026 forecasts as the company's first half of 2024 (1H FY2024) came within its expectations. It believes stronger business activities in 2H FY2024 could be partially offset by the recent ringgit strength.

“IHH is set for sustained growth, underpinned mainly by plans to increase bed capacity by 33 per cent by 2028.

“Hence, we maintain a ‘Buy’ call with a slightly higher target price (TP) of RM7.70 to reflect the higher market cap of India-listed Fortis Healthcare (31.1 per cent-ownership), it said in a note today.

Public Investment Bank Bhd said it raised IHH's FY2024 forecast by six per cent to factor in a higher number of inpatient admissions and maintained its FY2025-2026 earnings forecasts.

“We reiterate our ‘Outperform’ call on IHH, with a higher TP of RM7.68, based on 20 times FY2025 enterprise value/earnings before interest, taxes, depreciation and amortisation.

“We also favour IHH’s initiatives in rebranding, enhancing service offerings across the healthcare continuum, and optimising underperforming assets, which positions the group to remain competitive in the evolving healthcare landscape,” it said in a note.

-- BERNAMA