Kuala Lumpur, 22 Oct — The 2025 Budget failed to deliver significant incentives, resulting in heightened disappointment among investors, with property stocks leading the Malaysian stock market’s losses for a second consecutive day.
Initially expected to be the big winners from the budget, property stocks were left deflated due to the absence of surprise measures like the Home Ownership Campaign (HOC). The Kuala Lumpur Property Index fell 1.29% on Monday, followed by another 0.86% decline on Tuesday.
However, as the market moved into the afternoon, some investors began bargain hunting, allowing certain property stocks to stabilize and even regain ground. The Property Index trimmed its loss to just 0.37%.
Despite this, Malaysia’s two largest property developers suffered two straight days of decline after the budget announcement. IOI Properties Group (IOIPG, 5249, Main Market) dipped by another 0.42% or 1 sen to close at RM2.37, while Sime Darby Property (SIMEPROP, 5288, Main Market) fell 1.33% or 2 sen, closing at RM1.48.
Other notable developers also faced downward pressure. Eco World Development Group (ECOWLD, 8206, Main Market) fell 0.54% or 1 sen, closing at RM1.85, while Lagenda Properties (LAGENDA, 7179, Main Market) dropped 2.22% or 3 sen, ending at RM1.32.
On the positive side, some key property stocks began to recover. SP Setia (SPSETIA, 8664, Main Market) rebounded by 0.7% or 1 sen to RM1.43, while Mah Sing Group (MAHSING, 8583, Main Market) gained 1.73% or 3 sen, closing at RM1.76.
Although the sector has underperformed over the past two days, analysts at Maybank Investment Bank Research remain optimistic about the property industry’s prospects, noting that investors can look forward to potential policy catalysts in the near future.
“The short-term investment themes for the sector include the Johor-Singapore Special Economic Zone (JS-SEZ), expected to be announced in December, and updates on the Kuala Lumpur-Singapore High-Speed Rail (HSR) project, which may offer short-term trading opportunities for investors,” said the analyst.
The analyst emphasized that long-term growth for the industry will continue to be driven by asset appreciation, such as land sales to data center operators, or through corporate actions like spin-offs to unlock value.
“Our investment strategy for the property sector remains unchanged, with selective exposure to the JS-SEZ theme. We focus on companies with strong fundamentals and the ability to enhance shareholder value over the medium term,” the analyst concluded.
They maintained a “positive” rating, recommending buys on SP Setia and Eco World.