Malaysia - Housing

[winston]

1H26 Outlook: Quality Over Quantity Highlights

Despite rising construction costs, we maintain a constructive 1H26 outlook, supported by:
a) Johor-led strength in mid-range to high-end residential demand;
b) sustained industrial momentum;
c) rising approved investments into Johor under the JS-SEZ, with the blueprint expected in 1Q26; and
d) asset monetisation catalysts through potential REIT listings.

Maintain OVERWEIGHT on palatable valuations at 0.9x forward P/B (+0.5SD above mean) and a 60% discount to RNAV (+0.5SD to mean).

Top picks are Sunway, Eco World and IOIPG. Lagenda remains a laggard in the sector, supported by a 31% two-year CAGR during 2025-27, and currently trades at 6.4% 2026F yield.

Source: UOBKH

https://research.uobkayhian.com/content ... e=hs_email