KUALA LUMPUR: Kenanga Investment Bank Research kept its earnings forecasts on IGB REIT on expectedly weak 1HFY20 realised net income owing to the lockdown and tenant rental rebates.

According to the research house, realised net income of RM87.9mil in 1HFY20 came in broadly within its and consensus expectations at 37% and 35% of full-year estimates.

Gross dividend per unit of 0.62 sen brought 1HFY20 dividends to 2.56 sen, which was also within its FY20 target of 7.37 sen, implying 4.1% gross yield.

However, it added that subsequent quarters are expected to see improvements as the situation has eased slightly since the recovery movement control order on June 10, 2020.

On the REIT's acquisition of Southkey Mall in Johor, Kenanga said it is not expected to materialise in the near term and would likely take one reversion cycle or longer to stabilised before being acquired, likely in FY22.

Kenanga reiterated its "market perform" outlook on the stock with an unchanged target price of RM1.65.