OPTIMAX: Growth Prospects Highlighted as Analyst Maintains ‘Buy’ Rating

A recent research report from PhillipCapital indicates a generally positive long-term outlook for a healthcare provider, despite an expectation for softer sequential earnings in the first quarter of 2026. The anticipated dip in quarterly performance is primarily attributed to festive holidays, which are expected to reduce clinic operating days. However, the investment bank has maintained its “BUY” rating and an unchanged 12-month target price of RM0.79, signaling confidence in the company’s strategic initiatives and future growth.

Performance Review and Challenges

The report forecasts softer sequential earnings for 1Q26, stemming from festive holidays that curtail clinic operating days. The company is actively engaged in significant expansion projects, with Kempas and Selgate hospitals slated for completion by 3Q26 and operations commencing in 1Q27. Concurrently, renovations at the ACC in Pantai Indah Kapuk (PIK), Jakarta, are advancing towards an early-2027 operational target. Current utilization rates, such as the 50% for existing operating theatres (OTs) at Atria ACC, are projected to improve to 60-70% once new otorhinolaryngology (ENT) segments are fully operational.

Despite the positive trajectory, the report highlights several potential downside risks, including weak consumer spending, which could lead to reduced foot traffic, delays in the company’s expansion plans, and a persistent shortage of licensed medical practitioners. These factors could impact future performance.

Strategic Expansion and Future Outlook

The company is strategically broadening its service offerings and geographical footprint. A key initiative involves the launch of Juicemax, a new food, beverage, and in-house supplements store, at its Atria ACC by the end of March 2026. This move aims to enhance the customer experience by establishing a physical presence for previously online and clinic-based sales.

A significant development is the venture into ENT services, which is expected to require minimal capital expenditure, projected to be below RM1m annually. This efficiency is achieved by leveraging the existing OTs at Atria ACC, with management targeting to boost OT utilisation from the current 50% to 60-70%. The company plans to establish two new ENT clinics over the next three years, adopting a conservative, performance-based rollout strategy, similar to its successful Neumax model.

Looking ahead, surgeries are anticipated to constitute over 90% of the group’s revenue, underscoring the core focus of the business.

Valuation and Recommendation

PhillipCapital reiterates its “BUY” rating and maintains an unchanged 12-month target price of RM0.79. This valuation is derived from a 25x PE multiple on 2026E EPS, which positions it at a +1SD level above its 3-year mean. The investment bank considers current valuations to be undemanding, with the stock currently trading at -1SD its 3-year mean. The positive recommendation is underpinned by the company’s strategic expansion, projected improvements in asset utilization, and strong anticipated EPS growth for 2026.