KUALA LUMPUR (Nov 5): Sunway Real Estate Investment Trust (KL:SUNREIT) is expected to see stronger earnings for its third quarter ended Sept 30, 2026 (3QFY2026) based on past data and earnings in the hotel sector, said HLIB Research.

The research house estimated Sunway REIT’s core profit for 3QFY2026 to reach around RM120 million-RM134 million, bringing its cumulative nine-month core profit to around RM347 million-RM361 million, within HLIB’s 72%-75% full-year forecast.

“Our estimate is based on 3Q's historical contribution of 25%-28% of full-year core profit over FY2022-FY2025, with 3Q consistently stronger than 2Q as it is the peak season for the hotel segment,” said HLIB in a note on Thursday.

This is further bolstered by the hotel segment. Its Sunway Pier project, a RM462 million redevelopment in Port Klang, remains on track for completion by 2028 and is part of Sunway REIT’s plan to tap into Klang, which is seen as an untapped market by management.

Filling the income gap for Sunway Pier is the Sunway Hotel Seberang Jaya, which is targeted for completion by end-2027.

Meanwhile, Sunway REIT’s other hotels are performing well, with Sunway Putra Hotel and Sunway Resort Hotel reported by HLIB to see a stronger recovery, driven by an uptick in arrivals from the Middle East, China, India, Asean nations and airline crew.

“Bookings softened for about three months from end-February, as government spending cuts led agencies to hold fewer events…this has since normalised, with banquet occupancy rising to 59% in [the first half of 2026], helped by catering. Sports events have added some support,” said the research house.

With this stronger-than-expected recovery in hotel revenue, HLIB upgraded its FY2026-FY2028 core net profit forecasts to 2.8%, 4% and 2.4% respectively. Consequently, the research house raised its target price to RM2.31 from RM2.24, and maintained its 'buy' call on the REIT.