MIDF lowers FY2023F/2024F/2025F earnings forecast for Pavilion REIT, trims target price to RM1.48

• Nevertheless, the research house said on a brighter note, the earnings outlook for Pavilion REIT remains optimistic, driven by a positive rental reversion outlook for Pavilion KL Mall.

KUALA LUMPUR (Oct 27): MIDF Research has maintained its “buy” call on Pavilion Real Estate Investment Trust (Pavilion REIT) with a revised target price (TP) of RM1.48 (from RM1.63) and revised its FY2023F/2024F/2025F earnings forecast lower by 13.9%/8.9%/8.5% to factor in the higher property expenses.

Nevertheless, the research house said on a brighter note, the earnings outlook for Pavilion REIT remains optimistic, driven by a positive rental reversion outlook for Pavilion KL Mall. The mall continues to experience robust shopper footfall, with expectations of further improvement due to an anticipated increase in tourist arrivals.

“Besides, contribution from Pavilion Bukit Jalil will also support earnings growth, going forward,” it said.

Overall, MIDF maintains its “buy” call on Pavilion REIT, as it thinks Pavilion KL Mall and Elite Pavilion Mall, which are tourist hotspots, will benefit from higher tourist arrivals in 2024.

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