Kerjaya Prospek Property Bhd - Initiation
Fri, 15-May-2026 07:32 am
by Tan Wai Wern • Apex Research

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KPPROP (7077)

Target Price (RM)

0.39

Recommendation

Buy

  • Kerjaya Prospek Property Berhad (KPPROP) is a property developer specializing in high-rise residential and commercial real estate, complemented by a resilient recurring income base from its hospitality, retail, and leasing operations.
     
  • KPPROP’s core earnings are projected to grow by +33.6%, +242.4%, and +51.1% acrossFY26/FY27/FY28 respectively, underpinned by RM500m/RM720m/RM500m in estimated project launches.
     
  • We initiate coverage on KPPROP with a BUY recommendation and a target price of RM0.39,derived from a SOP valuation, incorporating a three-star ESG rating.

Key Investment Highlights
Robust Pipeline of High-Value Upcoming Launches. KPPROP is entering a new growth phase driven by a strategic roadmap to launch RM920m in Gross Development Value (GDV) through major projects in high-growth corridors. This upcoming cycle is anchored by the RM720m Batu Kawan development in Penang and the RM200m Jalan Puchong project in Kuala Lumpur, which together provide long-term earnings visibility. By spacing these launches, the Group maintains a disciplined balance sheet while diversifying its geographic footprint beyond the Klang Valley to tap into the industrial and residential expansion of mainland Penang through FY31.

Resilient Recurring Income from Hospitality Segment. KPPROP’s hospitality division is a vital driver of operational resilience, providing steady recurring income that buffers the cyclical nature of property development. This segment is anchored by high-performing assets including the Swiss-Garden Hotel Melaka and the Courtyard by Marriott KL South, which maintain robust occupancy rates of 82% and 71% respectively. These hospitality assets, complemented by retail and leasing contributions from the Bloomsvale Shopping Gallery, provide a stable defensive base and consistent cash flow to support future development activities.

Strategic Landbank with High GDV Potential. KPPROP maintains a prime 61-acre landbank, with 89.9% of it situated within the high-demand Klang Valley area. This portfolio carries an estimated GDV of RM3.8bn, positioning the Group to sustain development activities and capitalize on urban capital appreciation. The strength of this landbank is further underpinned by a disciplined acquisition strategy that maintains a land cost to GDV ratio below 15%, ensuring superior project margins and pricing flexibility. By securing high-quality sites in prime locations the Group is well-equipped to unlock long-term value through tactical developments.

Robust Earnings Outlook. We project KPPROP core earnings to grow at a CAGR of 90.5% between FY25 and FY28F, driven by accelerated revenue recognition from the Vox Residence and the RM720m Batu Kawan development. This growth trajectory is sustained by a forecasted RM1.72bn launch pipeline over the next three FY, which utilize a low land cost-to-GDV ratio to enhance margins. By unlocking its RM3.8bn total GDV potential while scaling recurring income from hospitality and retail assets, the Group effectively balances high-growth development with long-term earnings stability.

Valuation & Recommendation. We initiate coverage of KPPROP with a BUY recommendation and a target price of RM0.39, derived from a Sum-of-Parts (SOP) valuation and supported by a three-star ESG rating. Our valuation applies a conservative 50% discount to the RNAV of the Property Development division. For the non-development segments, we have assigned a P/E multiple of 8.6x against an FY27F EPS of 0.01 sen. This multiple reflects a -2 SD discount compared to the Malaysian property sector’s five-year average P/E of 12.0x.
 

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Market Mover
Settlement Rates
Currency Buy Rates (RM) Sell Rates (RM)
USD 3.915460 3.947106
EUR 4.599414 4.604229
CNY 0.578999 0.579621
HKD 0.500075 0.503611
SGD 3.076390 3.098124