IGB: Beat Expectations (IGBB MK, Neutral, TP: RM2.60)

IGB Berhad (IGB) reported yet another strong quarter with 2QFY26 earnings beating expectations.2QFY26 net profit of RM146.7m rose 94.7% YoY(-70.8% QoQ), primarily lifted by one-off disposal of overseas land by an associate company. YTD, the Group’s 1HFY net profit leapt by almost 4x to RM648.6m or already 89% of our estimates.

IGB Berhad

To recap, its first quarter profit was lifted by the sale of St Giles Hotel London which yielded a net gain of about RM453m. In 1HFY26, Group profits were also driven mainly by improved performance from the segments of property investment-retail, property investment-commercial, and hotels due to higher occupancy and average rates achieved.  

All told, we increase our FY26F earnings estimates by about 12.4% to account for one-off gain from the land disposal and change of billing assumptions. We reiterate our Neutral call and RM2.60 TP, pegged at c.1.0x book value.

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