KPJ Healthcare Upside on hold until doctors arrive; downgrade to Neutral

Research evidence excerpt

KPJ Healthcare Upside on hold until doctors arrive; downgrade to Neutral

J P M O R G A N Asia Pacific Equity Research

24 May 2026

KPJ Healthcare ▼Neutral

Previous: Overweight

Upside on hold until doctors arrive; downgrade to KPJH.KL, KPJ MK

Price (22 May 26):RM3.23

Neutral Price Target (Dec-26):RM3.40

KPJ’s post-1Q26 results briefing reinforced that the operating model is moving in Head of Malaysia Research,

the right direction: away from volume-led growth towards higher revenue intensity Healthcare, Construction, Consumer

centers of excellence (COE) and tighter referral integration. Strategically, we view and Conglomerates

this positively. However, after the recent re-rating (+20% YTD vs KLCI +2%), we Yen Voo, CFA, CA AC

think the investment debate has shifted from whether KPJ can improve, to whether (60-3) 2718 0914

KPJ can execute at scale. Our proprietary doctor tracker continues to show slower yen.voo@jpmorgan.com

JPMorgan Securities (Malaysia) Sdn. Bhd. (18146-

specialist additions versus peers amid ongoing attrition, while utilization remains X)

moderate. Our unchanged forecasts imply FY25–28E sales/EBITDA CAGRs of Nigel Ng

10/8%, broadly in line with consensus. We maintain our PT at RM3.40 but (60-3) 2718 0962

downgrade to Neutral, as we think further upside is dependent on evidence that KPJ nigel.ng@jpmorgan.com

can fill incremental capacity with specialists and sustain revenue intensity. JPMorgan Securities (Malaysia) Sdn. Bhd. (18146- X)

• Fundamentals are improving...: 1Q26 reflected continued progress in Kae Pornpunnarath, CFA

monetisation rather than volume. Average inpatient revenue rose 6% YoY to (66-2) 684-2679

kae.pornpunnarath@jpmorgan.com

RM8.6k, supported by a richer case mix and improving medical tourism JPMorgan Securities (Thailand) Limited