Stock Review – ALAQAR (5116) (AL-AQAR HEALTHCARE REIT)
Sector : Real Estate Investment Trust
Sub Sector : Real Estate Investment Trust
Focus : Healthcare
Company Profile:
ALAQAR is managed by Damansara REIT Managers Sdn Bhd, a wholly-owned subsidiary of Johor Corporation Group (JCorp) and support by KPJ Healthcare Berhad.
As of December 2019, ALAQAR consists of 23 properties comprising of 17 hospitals, 3 wellness/ healthcare centres, 2 colleges and 1 aged care and retirement village. One of them is located in Queensland Australia.
Properties:
a) Hospitals
|
Property Name |
Location |
Tenancy Expiry |
Rental / GFA (2018) |
Rental / GFA (2019) |
|
KPJ AMPANG PUTERI SPECIALIST HOSPITAL |
Ampang, Selangor |
June 2021 |
24.95 |
25.45 |
|
KPJ DAMANSARA SPECIALIST HOSPITAL |
Petaling Jaya, Selangor |
June 2021 |
19.25 |
19.64 |
|
KPJ JOHOR SPECIALIST HOSPITAL |
Johor Bharu, Johor |
June 2021 |
17.45 |
17.66 |
|
KPJ PUTERI SPECIALIST HOSPITAL |
Johor Bharu, Johor |
June 2021 |
23.69 |
24.16 |
|
KPJ SELANGOR SPECIALIST HOSPITAL |
Shah Alam, Selangor |
June 2021 |
18.01 |
18.37 |
|
KPJ IPOH SPECIALIST HOSPITAL |
Ipoh, Perak |
June 2021 |
13.99 |
14.11 |
|
KPJ PERDANA SPECIALIST HOSPITAL |
Kota Bharu, Kelantan |
February 2020 |
22.02 |
22.46 |
|
SENTOSA MEDICAL CENTRE |
Kuala Lumpur |
June 2021 |
24.41 |
24.90 |
|
KPJ KAJANG SPECIALIST HOSPITAL |
Kajang, Selangor |
February 2020 |
17.45 |
17.80 |
|
KEDAH MEDICAL CENTRE |
Alor Setar, Kedah |
February 2020 |
17.33 |
17.68 |
|
KPJ PENANG SPECIALIST HOSPITAL |
Bukit Mertajam, Pulau Pinang |
October 2021 |
25.69 |
25.26 |
|
KPJ TAWAKKAL SPECIALIST HOSPITAL |
Kuala Lumpur |
July 2022 |
25.44 |
25.69 |
|
KPJ SEREMBAN SPECIALIST HOSPITAL |
Seremban, Negeri Sembilan |
October 2024 |
26.08 |
26.77 |
|
TAIPING MEDICAL CENTRE |
Taiping, Perak |
April 2021 |
17.75 |
17.87 |
|
KLUANG UTAMA SPECIALIST HOSPITAL |
Kluang, Johor |
January 2021 |
9.30 |
9.49 |
|
KPJ KLANG SPECIALIST HOSPITAL |
Klang, Selangor |
June 2021 |
20.63 |
20.60 |
|
KPJ BATU PAHAT SPECIALIST HOSPITAL |
Batu Pahat, Johor |
December 2022 |
|
0.15 |
b)
Wellness / Healthcare Centre|
Property Name |
Location |
Tenancy Expiry |
Rental / GFA (2018) |
Rental / GFA (2019) |
|
KUANTAN WELLNESS CENTRE |
Kuantan, Pahang |
June 2021 |
20.38 |
20.79 |
|
DAMAIN WELLNESS CENTRE |
Kota Kinabalu, Sabah |
June 2021 |
25.15 |
20.72 |
|
TAWAKKAL HEALTH CENTRE |
Kuala Lumpur |
May 2021 |
26.22 |
26.74 |
c) College
|
Property Name |
Location |
Tenancy Expiry |
Rental / GFA (2018) |
Rental / GFA (2019) |
|
KPJ HEALTHCARE UNIVERSITY COLLEGE, NILAI |
Nilai, Negeri Sembilan |
|
9.68 |
15.68 |
|
KPJ INTERNATIONAL COLLEGE, PENANG |
Bukit Mertajam, Pulau Pinang |
October 2021 |
27.84 |
26.64 |
d) Aged
and retirement village
|
Property Name |
Location |
Tenancy Expiry |
Rental / GFA (2018) |
Rental / GFA (2019) |
|
JETA GARDENS AGED CARE & RETIREMENT VILLAGE |
Queensland, Australia |
|
9.68 |
15.68 |
Fee
ALAQAR maintenance fee had increase from RM 599,810 in 2016 to RM 2,113,889 in 2019 which is Compound annual growth rate of 37.01 %. This made the maintenance fee / rental increase from 0.61 % to 2.11 %.
For the year 2009 to 2019, the management fee is range 1.40 % – 2.36 % of total rental income while the total fee is range 2.47% - 4.41 %.
From the chart above, the gross income for ALAQAR had drop significantly in 2016 and slight more in 2017. This is because of disposal of Rumah Sakit Bumi Serpong Damai and Rumah Sakit Medika Permata Hijau from Indonesia in 2016 and further disposal of Selesa Tower, Johor Bharu in 2017.
However there is an increase in nett income in 2017 and 2018, this is mainly because of higher gain on fair value on investment properties which is RM 24,791,923 and RM 30,341,920 which is paper gain. The REIT does not have any benefit from the gain on fair value on investment properties besides increase the value of asset. ALAQAR also had to pay more tax due to the profit recorded in the income statement. The same go to year 2011 where the nett profit is higher than the gross profit. In 2011 ALAQAR recorded fair value gain of RM 38,794,262.
Market Capitalisation vs Nett Asset
From the chart, ALAQAR had trade at a premium during 2012 to 2017.
Dividend
Over the past year 2010 to 2019, ALAQAR had pay to shareholder an average dividend of 7.51 sen which is 5.73 % of the today price 1.31 (i November 2020).
Convid 19
During the pandemic, ALAQAR had provide assistance to its tenants in the form of rental rebate. From the quarter report for financial end 30 June 2020, the gross revenue from the first six month of 2020 had decrease by 6.4 % compared to first 6 month of 2019 besides that the property expense had increase by 10 %.
Besides that the trust expense had also increase by 5 % compare to the first 6 months of 2019. The net earning per share for the first 6 month had reduce from 4.24 sen in 2019 to 3.54 sen in 2020 which is 16.5 % decrease.
With the government of Malaysia declare Conditional MCO in Sabah, Selangor, Kuala Lumpur, Putrajaya and recently Johor Bharu, these would further affect the tenant of ALAQAR. Further discount on the rental rate might be given to the tenants.
Market Research
MIDF AMANAH INVESTMENTBANK BHD (1 September 2020)
Price Target : RM 1.42
- 1HFY20 earning below expectation
- Earning weight by rental rebate
- Earning drag by higher financial cost
- Earning forecast reduce
IVKLS Value
1.06
http://ivkls.blogspot.com/2020/10/stock-review-alaqar-5116-al-aqar.html
