Staying nimble

Trading below mean valuation; maintain BUY

1Q21 results was driven by the COVID 19-related services. However, 2Q21
results could be weaker as Singapore and Malaysia (59% of Group’s EBITDA
in 1Q21) could be temporarily affected by the renewed lockdowns.
Maintain our earnings forecasts, BUY call and SOP-based TP of MYR6.30.
We like IHH for its undemanding 12M forward EV/EBITDA of 15x (5-year
mean: 20x) and clear strategies in raising its profitability.

Within expectation

Excluding the exceptional items (totalling positive MYR40m), 1Q21 core
net profit of MYR336m (+77% YoY, -10% QoQ) accounted for 30% and 33% of
our and street’s full-year estimates. We consider the results to be within
our expectation as 2Q21 could be sequentially weaker. Separately, the 12M
trailing ROE of 4.5% (FY20: 3%) is near management’s target of at least 5%
by 2024.