PETALING JAYA: IHH Healthcare Bhd

is rejigging its near-term capital expenditure (capex) plan to support more day procedures given the strict claim processes among insurers.

According to CGS International (CGSI) Research, the stricter measures are among efforts to manage medical inflation noting day procedures can help lower bill sizes for patients while improving cost efficiencies.

“However, its management said the plans would not derail IHH’s medium-term target of opening some 4,000 beds over the financial year 2024 to 2028 (FY24 to FY28), of which some 1,000 beds were added in FY24,” CGSI Research said.

Commenting on the hospital group’s recently released second quarter financial results, the research house said IHH’s performance was slightly below its expectations, with the cumulative first half FY25 core net profit forming 44.4% of its FY25 estimates but in line at 50.9% of Bloomberg consensus estimates.

“The relatively firm ringgit against other currencies of IHH’s other operating geographies, such as the Singapore dollar, Indian rupee and the Turkyish lira, led to negative translational impact for IHH, resulting in softer revenue and earnings before interest, taxes, depreciation, and amortisation growth year-on-year of 3.4% and 0.3%, respectively in 2Q25,” it said.

Similarly, UOB Kay Hian (UOBKH) Research said IHH’s core net profit was below expectations, with these latest updated earnings accounting for 44% and 43% of its and consensus full-year forecasts respectively.

“While second half’s earnings are expected to be stronger, the shortfall was due to softer-than-expected contributions from key markets, namely Singapore, Malaysia, and Hong Kong,” UOBKH Research said.

It had maintained its “buy” call on IHH with a lower sum of parts based target price of RM7.90 from RM8.30 before following revised earnings expectations.