The property sector displayed a robust outlook with healthy demand, according to reports by MIDF Amanah Investment Bank (MIDF). Data from Bank Negara Malaysia (BNM) indicated that total loan applications for property purchases normalised to RM52.4 billion in June 2024, despite a slight monthly decline, and cumulative total loan applications rose to RM307 billion in the first half of the calendar year 2024 (1HCY24), showcasing strong buying interest driven by a stable Overnight Policy Rate (OPR) of 3% and an improving sector outlook.

MIDF maintains a POSITIVE rating on the property sector, citing a promising outlook and the anticipation of earnings growth for property developers in the upcoming second quarter of CY24. The bank highlighted Mah Sing Group Berhad and Matrix Concepts Holdings Berhad as top picks, recommending a BUY for both with target prices of RM1.97 and RM2.22 respectively.

Mah Sing Group recorded RM992 million in new sales in the first four months of the fiscal year 2024 (4MFY24), on track to meet its sales target of RM2.5 billion for the year. The company is also expanding its data centre venture and maintains a healthy balance sheet with low net gearing of 0.06x.

Matrix Concepts Holdings is expected to see positive earnings growth in FY25, supported by its property projects in the Bandar Sri Sendayan township and earnings catalysts from its Malaysia Vision Valley (MVV) land, with the first launch targeted for the second half of FY26 (2HFY26). The company's dividend yield remains attractive, estimated at 5.7%.

The strengthening of the Ringgit was expected to have minimal impact on property companies, as most revenues and costs are Ringgit-denominated, except for companies with overseas exposure such as IOI Properties Group, S P Setia, and Sunway Berhad. The KL Property Index experienced a significant sell-off, resulting in the price-to-book ratio falling below its long-term mean, which MIDF sees as a buying opportunity for investors given the property sector's upcycle.