Long road ahead for MRCB with Ipoh Sentral project, analysts say

• The transit-oriented development project will add 19% to MRCB’s total remaining gross development value (GDV), for it to reach RM38.6 billion, said Hong Leong Investment Bank (HLIB).

KUALA LUMPUR (Jan 24): Malaysian Resources Corporation Bhd (KL:MRCB) will have a long road ahead in gestating the development of the newly secured Ipoh Sentral project that will span 20 years in phases, analysts said.

The transit-oriented development project will add 19% to MRCB’s total remaining gross development value (GDV), for it to reach RM38.6 billion, said Hong Leong Investment Bank (HLIB). The development rights cost under 10% of GDV, which looks manageable, the house said.

The payment schedule is based on development progress and a combination of cash, profit sharing and land swaps, making it “less stressful” on MRCB’s balance sheet, HLIB said. “Although we view this development positively, we take note of the extended development period,” it said.

On Thursday, MRCB announced that it is partnering Ipoh Sentral Sdn Bhd — a 50:50 joint venture between Railway Assets Corporation and Perak state-owned Silver Smart Sdn Bhd — to jointly develop the RM6.25 billion project.

If successful, the project that includes community facilities, commercial units, and residential properties will be the largest mixed-use development in central Ipoh.

The project also comes after MRCB exited a consortium led by Berjaya Corporation Bhd (KL:BJCORP) bidding for the Kuala Lumpur-Singapore high-speed rail (HSR) project to pursue other opportunities.

“This decision could be tied to the success of securing the Ipoh Sentral tender, which aligns closely with MRCB’s expertise” in transit-oriented developments, said MIDF Amanah Investment Bank.

“This, along with the complementary Ipoh Raya Integrated Park, positions MRCB to play a pivotal role in transforming Ipoh into a key economic hub,” the house said.

However, earnings from the Ipoh Sentral project are expected to only trickle in from 2026, given the multiple phases, the house noted.

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