IHH Healthcare's planned $2 billion listing in Malaysia and Singapore -
the third largest initial public offering of the year globally - has brought
interest back into healthcare stocks in Southeast Asia such as Singapore's
Raffles Medical Group Ltd , CIMB said in a report.
Shares of Raffles Medical were up
0.9 percent at S$2.36, and have gained 11 percent so far this year, compared to
the Thomson Reuters Asia Pacific and Russia Healthcare Index's 5.6 percent
rise.
"Recent news flow pertaining
to the dual listing of healthcare giant IHH Healthcare in Malaysia and
Singapore has certainly brought interest back," said CIMB, adding
company-specific news also helped.
Raffles Medical will benefit from
hospital bed shortage in Singapore, which has a lower bed ratio lower than
other developed countries at 2.22 beds per 1,000 people in 2010, CIMB said. It
has an 'outperform' rating on the stock with a target price of S$2.69.
"With capacity constraints
in public and other private hospitals, patient loads at Raffles Medical's
flagship Raffles Hospital have been good," the brokerage said.
Raffles Medical is adding
capacity at Raffles Hospital by increasing clinical services and specialist
offerings, at a time when healthcare costs are rising.
Other healthcare stocks in the
region include Thailand's Bumrungrad Hospital, which has surged 71 percent this
year, and Malaysia's KPJ Healthcare, up 35 percent this year.
Charmian Kok
Business & Investment Opportunities
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