Land Sale Boosts IOI Properties Share Price In Mid-morning Trade

KUALA LUMPUR, Feb 5 (Bernama) -- IOI Properties Group Bhd’s share price rose in mid-morning trade today after its subsidiary's disposal of 50 hectares (ha) of industrial land in Banting, Selangor, to Bridge Data Centres Malaysia VIII Sdn Bhd (BDC) for RM740.68 million.

The land is located in the IOI Industrial Park @ Banting, and BDC’s decision to purchase the land is to support its data centre business expansion.

At 11 am, the counter rose by eight sen to RM3.25 per share, with 6,07 million shares transacted. 

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In a research note today, Hong Leong Investment Bank Bhd said the transaction implies a selling price of RM125 per square foot (psf).

“The all-in land cost is estimated to be about RM50 psf (comprising carrying land cost of about RM26 psf and estimated infrastructure cost of about RM24 psf).

“Accordingly, the land sale is expected to deliver an attractive gross profit margin of around 60 per cent, translating into an estimated net profit of RM337.8 million, by our estimates,” it said. 

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The land deal is expected to be completed in the second or third quarter of 2027.

“Given the attractive margin, this transaction is expected to lift our 2027 earnings forecast significantly by 32.6 per cent,” the research note said.

On a pro forma basis, Hong Leong Investment Bank said the sale proceeds will reduce the group’s net gearing from 94.2 per cent as at Sept 30, 2025, to 91.2 per cent.

“This is a tangible step in the group’s ongoing balance sheet deleveraging efforts. Looking ahead, the group’s upcoming Malaysia REIT listing, expected in the 3Q 2026, should further reduce its net gearing,” it said.

Hong Leong Investment Bank has a “Buy” rating with a target price of RM4.15 per share. 

-- BERNAMA