KUALA LUMPUR: WCT Holdings Bhd is expected to include all its retail malls in its plans to set up a real estate investment trust (Reit) and list it on Bursa Malaysia.
MIDF Research said the Reit may also include WCT's three hotels.
The group wholly owns Aeon Mall Bukit Tinggi and Paradigm Mall Johor Bahru, while its three hotels are Le Meridien Petaling Jaya, Premiere Hotel Klang and Hyatt Place Johor Bahru.
WCT also owns a 70 per cent stake in both Paradigm Mall Petaling Jaya and gateway@klia2 and 60 per cent of Subang Skypark.
MIDF Research said all five malls are close to full occupancy.
WCT on Wednesday proposed to set up and list a REIT on the Main Market of Bursa Malaysia.
This will involve the disposal of the properties by the subsidiaries and joint ventures of their entire stake to the Reit to be paid in cash and new Reit units.
MIDF Research said.apart from allowing it to unlock the value of its malls, WCT will also be able to raise funds to pare down its borrowings.
With total borrowings of RM3.15 billion as at March 31 this year, the group is highly geared at 74.5 per cent net.
"This will place WCT in better financial standing in anticipation of upcoming mega projects in the country," the firm added.
Meanwhile, MIDF Research said after a two-year hiatus, WCT had finally secured a much-needed external job in June, a RM249.7 million package for the construction of additional lanes for the North-South Expressway on the stretch from Yong Peng to Senai in Johor.
The project is expected to be completed in three years by June 2027.
The company's outstanding orderbook now stands at RM3.2 billion.
"WCT has an active tender book of RM20.0 billion. Assuming a conservative hit rate of 10 per cent, we opine WCT may be able to secure RM2.20 billion of new jobs for FY24."
This may come from the Penang International Airport expansion, Pan Borneo Sabah, other packages for the North-South Expressway expansion and potentially its first data centre project.
"The RM1.3 billion Subang Airport Regeneration Plan will provide WCT with an immediate boost to its order book, although more clarity is needed on the implementation of the project," the firm said.
MIDF Research kept its "Neutral" call on WCT but revised the target price to 97 sen from 50 sen.