KUALA LUMPUR: I-Bhd’s business prospects for 2022 are looking bright, as the group continues to attract high-profile tenants at its i-City development in Shah Alam and still has a substantial amount of unrealised gains from ongoing projects.

       PublicInvest Research in a report yesterday said the group will continue to work on reducing its inventory levels, which currently stand at RM811.5mil and of which about RM500mil comprises its 8KiaPeng project in downtown Kuala Lumpur.

       “On a positive note, it has been reported that Malayan Banking Bhd will be taking up 14 floors at its Grade-A corporate office in Shah Alam, consequently bringing up occupancy rates to 80%.”

       Additionally, the research house noted that I-Bhd’s BeCentral serviced apartment tower, which has yet to be officially launched, continues to see sales recognised in its books.

       “With the completion and gradual handover of the Hill10 Residences, the DoubleTree by Hilton is also now slated to open its doors by mid-2022, all pointing towards a more meaningful financial year 2022 for the group.”

       I-Bhd reported a net profit of RM3.2mil for its third quarter ended Sept 30, 2021, turning around from the RM3.4mil loss it reported in the immediate preceding quarter.

       PublicInvest Research said the earnings boost was due to fair value gains.

       “However, there are some nascent signs of encouragement for the coming financial year.

       “Cumulative nine-month period ended Sept 30, 2021 net loss of RM4.8mil is below expectations, with the movement restrictions reimposed in the months under review weighing heavily,” the research firm said.

       PublicInvest Research said it is cutting its 2021 estimates for I-Bhd by 63% to reflect the current challenges.

       “We still expect the group to remain profitable this financial year on expectations of a stronger recovery in its leisure segment this year.

       “We continue to like I-Bhd’s long-term value proposition, underpinned by the fact that about 60% of its gross development value is yet to be realised, though we retain our ‘neutral’ call in the absence of near-term re-rating catalysts.”

       Analysing I-Bhd’s third-quarter 2021 performance further, PublicInvest Research said the group’s property development segment remained profitable as it continued to recognise earnings from construction progress of its Hill10 and BeCentral projects.

       “We understand keys are already being handed over to Hill10 purchasers, which should see billings rise in the fourth quarter, though possibly lowering unbilled sales, which is currently at RM32.9mil as at end-September.”

       I-Bhd’s property investment segment, meanwhile, reported a pre-tax profit of RM1mil.

       The research firm said this was due to a fair value gain from development cost savings for the corporate office tower, which would have otherwise been weighed by losses at the mall as a result of the lockdown imposed during the quarter.

       “The group’s leisure segment was also not spared, sinking to a pre-tax loss of RM2mil,” it said.