Westports: Neutral ratings maintained

Analysts maintain Westports Holdings Berhad “Neutral” rating with an unchanged target price of RM4.30. The key highlights are:

The share price on October 9, 2024, was RM4.20, with an expected total return of +6.8% (2.4% price return and 4.4% dividend yield).

Weakness persists in the Asia-Europe transshipment trade due to the Red Sea crisis, showing a -10% decline in container volume in 1HFY24.

Intra-Asia trade remains strong, growing by +6.5% and expected to be the volume driver for the company.

High container yard occupancy, which peaked at 100% in June 2024, has decreased to 75%, but is still above the ideal 65%.

Container volume growth for FY24 is projected at +4.2% year-on-year, driven by gateway volume, which involves higher handling charges.

No changes were made to earnings estimates, and the stock’s valuation is in line with historical averages.

The outlook is stable with moderate growth expectations, but potential upside could come from a tariff increase or higher container volume. – MIDF

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Staff Writer

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