Latest news with #MIDFResearch
BusinessToday
3 days ago
- Business
- BusinessToday
Logistics: Red Sea Stabilised But New Risks Emerge In Straits Of Hormuz
MIDF Amanah Investment Bank Bhd (MIDF Research) has maintained a NEUTRAL rating on the ports and logistics sector, with Buy on Tasco and a target price of RM0.68, citing its favourable valuation and protective pricing mechanisms amid freight volatility. Container throughput in Malaysia rose 6% year-on-year in the first quarter of 2025, reaching 7.7 million TEUs, boosted by frontloading activities ahead of rising US tariffs. The Port of Tanjung Pelepas saw the strongest growth at 11%, driven by its participation in the Maersk-Hapag Gemini alliance. Meanwhile, Port Klang recorded a 2% gain, while Penang and Johor reported contractions. Spot freight rates from Southeast Asia to the US West Coast surged between late March and April, supporting the spike in volumes. Drewry revised its global container volume growth forecast for 2025 to 1.9%, reversing earlier expectations of a decline, which the house said suggests further near-term upside for transhipment ports. However, the second half of the year remains uncertain amid tariff uncertainties, vessel oversupply, and tepid European demand. MIDF Research noted that the Red Sea shipping routes have largely stabilised, but new risks have emerged from geopolitical tensions in the Strait of Hormuz, following an Iranian parliamentary vote to shut the channel. Although Malaysia's Westports is unlikely to be directly affected due to its route bypassing Hormuz, regional ports may face vessel bunching and increased yard utilisation if shipping lines are forced to reroute. The investment bank flagged that short-term berth delays could still occur in the region as feeder alignments adjust. Warehousing demand remains strong, especially in the Klang Valley, where prime logistics space is being absorbed steadily thanks to e-commerce and ongoing manufacturing investment. Rents in Johor are gradually increasing due to cross-border spillover effects from Singapore and data-centre driven activity, while Penang's rates have levelled off with new capacity easing pressure. Vacancy rates across the country remain below 5%, with most new facilities already pre-leased. MIDF expects the Smart Logistics Complex incentives under Budget 2025 to further support the sector's medium-term rental stability. Stricter truckload limits will be enforced from July 1, with overloaded vehicles denied port access. This includes a nationwide ban on tandem container configurations by January 2026. MIDF cautioned that while safety will improve, haulage costs are likely to rise, and inland delivery times may face some initial disruption as logistics firms adapt their fleet operations. Tasco remains the sector's top pick for MIDF Research, as the company trades below its historical average and has implemented a clause to adjust prices if rates swing more than 10% above tender levels. With 80% of its forwarding business conducted through tenders, Tasco also benefits from customers favouring short-term contracts during volatility, which typically offer better margins. Earnings are expected to improve from contract logistics wins and Investment Tax Allowance support. Related
BusinessToday
4 days ago
- Business
- BusinessToday
Stock Today: Slow Climb For Sunway As Trading Interest Holds
Shares of Sunway Bhd rose slightly to RM4.69 in active afternoon trading, up 0.64% or 3 sen from the previous close, as investors digested recent updates on the group's healthcare expansion and earnings outlook. At 3.20pm, the counter saw a trading volume of 3.7 million shares, with prices fluctuating between RM4.67 and RM4.74 during the day. Buy and sell queues were relatively balanced, with more than 200,000 shares on the buy side and over 790,000 on the sell side. The modest uptick comes amid a reaffirmed neutral call from MIDF Research, which maintained its target price at RM4.86. While Sunway's healthcare segment is expected to benefit from upcoming EPF Account 2 withdrawal policies for health insurance, analysts said the stock's near-term upside is limited. The research house also highlighted that the group's strong FY24 performance driven by Singapore contributions is likely to normalise in FY25, with healthcare profit before tax share declining due to startup and pre-operational costs at new hospitals. Still, with ongoing hospital developments in Putrajaya and planned expansion to 3,000 beds by 2030, investors appear cautiously optimistic, keeping the stock in focus as a long-term growth play. Related
Focus Malaysia
6 days ago
- Business
- Focus Malaysia
Foreign funds exit from Bursa, regional markets escalates amid Middle East conflict
FOREIGN investors extended their selling streak on Bursa Malaysia to a fifth week by posting a net outflow of -RM565.2 mil for the June 16-20 trading period which was slightly higher than the previous week's net outflow of -RM444.4 mil. They were net sellers on every trading session with outflows ranging from -RM52.5 mil to -M202.2 mil, according to MIDF Research. 'The largest outflow was recorded on Friday (June 20), followed by Monday with -RM130.3 mil,' observed the research house in its weekly fund flow report. The three sectors that recorded the highest net foreign inflows were transportation & logistics (RM95.8 mil), REITs (RM38.4 mil) and Construction (RM28.9 mil). On the other hand, the top three sectors with the highest net foreign outflows were financial services (-RM387.4 mil), healthcare (-RM110.0 mil) and industrial products & services (-RM52.9 mil). On the contrary, local institutions extended their buying spree to a fifth week with net purchases of RM510.6 mil. Likewise, local retailers also returned to buying mode last week with a net inflow of RM54.7 mil to snap their two-week outflow streak. The average daily trading volume (ADTV) saw a broad-based decline last week with the exception of foreign investors. Local institutions and local retailers saw a decline of -13.3% and -10.9% respectively while foreign investors saw a surge of +24.0%. In comparison with another four Southeast Asian markets tracked by MIDF Research, all recorded outflows with the largest emanating from Thailand at -US$298.3 mil to end its single-week of net buying streak. Indonesia came in second with a net outflow of -US$275.4 mil after a brief week of inflow while the Philippines posted a net outflow of -US$61.8 mil to extend its foreign selling streak to two weeks. Vietnam posted the smallest outflow among the regional markets at -US$7.3 mil to end a one-week inflow streak. The top three stocks with the highest net money inflow from foreign investors last week were Westports Holdings Bhd (RM86.5 mil, Tenaga Nasional Bhd (RM74.0 mil) and Eco-Shop Marketing Bhd (RM42.5 mil), – June 23, 2025
New Straits Times
6 days ago
- Business
- New Straits Times
Foreign sell-off hits RM565.2mil
KUALA LUMPUR: Foreign investors continued their streak of net outflows on Bursa Malaysia for the fifth consecutive week, with a net outflow of RM565.2 million, according to MIDF Research. In a note, the firm said the figure was slightly higher than the previous week's outflow of RM444.4 million. MIDF also added that foreign investors were net sellers on every trading day, with outflows ranging from RM52.5 million to RM202.2 million. It said the largest outflow was recorded on Friday, followed by Monday with RM130.3 million. "The three sectors that recorded the highest net foreign inflows were transportation & logistics (RM95.8 million), real estate investment trusts (REITs) (RM38.4 million) and construction (RM28.9 million). "The top three sectors that recorded the highest net foreign outflows were financial services (RM387.4 million), healthcare (RM110.0 million) and industrial products & services (RM52.9 million)," it said. Meanwhile, MIDF noted that local institutions continued their buying activities, extending to a fifth week buying streak with net inflows amounting to RM510.6 million. It also noted that local retailers returned to net foreign buyers last week, recording a net inflow of RM54.7 million, snapping their two-week outflow streak. "The average daily trading volume (ADTV) saw a broad-based decline last week, with the exception of foreign investors. "Local institutions and local retailers saw a decline of 13.3 per cent and 10.9 per cent, respectively, while foreign investors saw a surge of 24.0 per cent," it said.
The Star
20-06-2025
- Business
- The Star
DC outlook intact for now
Sunway University economics professor Dr Yeah Kim Leng. PETALING JAYA: There is a possibility that the firms involved in the alleged breach involving Nvidia-powered artificial intelligence (AI) chips may face US sanctions, but such measures are unlikely to be applied to Malaysia, says Sunway University economics professor Dr Yeah Kim Leng. Yeah said this is given that many existing data centres (DCs) and those in the pipeline are US-based companies. 'Nvidia, a US company, is seeking new markets to offset its loss of China's market as the Chinese government has banned the use of its chips. 'China is accelerating development of home-grown AI chips, thereby offering an alternative supply unless companies that use them are also sanctioned by the United States,' he told StarBiz. Yeah opined that despite the uncertainties caused by the technological rivalry between China and the United States, the outlook for DCs in Malaysia remained positive given the rising local and global demand for cloud and AI services. 'Malaysia will also benefit from the global firms' diversification of DCs that leveraged on each country's growth opportunities and cost advantages such as availability of cheap energy, land and skilled manpower resources,' he said. According to a Wall Street Journal article, Chinese engineers reportedly flew to Malaysia in March with suitcases full of hard drives containing around 80 terabytes of data to train AI models at local DCs equipped with advanced Nvidia chips. In addressing the alleged breach, the Investment, Trade and Industry Ministry (Miti) said, in a statement on Wednesday, it is in the process of verifying the matter with relevant agencies. It reiterated that servers using Nvidia chips and AI chips are not classified as controlled goods under the Malaysian Strategic Trade Act 2010. 'Malaysia will cooperate with any government that requires assistance in monitoring trade in sensitive goods under the export control of their respective countries,' it said. Given that the allegations were made in March, MIDF Research said it could be a move to 'speed up the process', before the eventually rescinded AI Diffusion Framework that was expected to come into force on May 15. The research house is of the view that the pipeline of DC jobs in Malaysia is unlikely to be impacted by the alleged breach. It noted there is no slowdown or delay in ongoing projects and contractors are actively bidding for new DC construction jobs. 'Just last month, Gamuda Bhd sold 389 acres of land in Port Dickson to Google-linked Pearl Computing Malaysia Sdn Bhd and signed a RM1.01bil external infrastructure contract for enabling works for DC development, while Sunway Construction Group Bhd secured a RM1.16bil contract from a US tech giant to build two DCs,' MIDF Research said in a report yesterday. Microsoft recently reaffirmed its commitment to a RM10.5bil investment in cloud and AI infrastructure in Malaysia, including the development of hyperscale DCs in the Klang Valley. 'We also reiterate that not all DCs are AI DCs and while most of them are AI-ready, they may eventually be utilised for non-AI purposes,' MIDF Research said. It cited the example of YTL Power International Bhd which previously allocated 100MW for AI from its 500MW DC in Kulai, Johor. iFAST Capital research analyst Kevin Khaw Khai Sheng said the long-term prospects of the country's DC sector remains 'quite intact'. 'Ultimately, Malaysia continues to benefit from several competitive advantages –such as abundant water resources for cooling, land, skilled labour and a relatively weak ringgit, which makes the country cost-effective,' he said. Khaw added that, due to Singapore's limited access to such resources, he expected closer collaboration between Malaysia and the city-state. Asked if the alleged breach would affect ongoing tariff negotiations between Malaysia and the United States, Khaw said it would unlikely be a decisive factor given that the country is already negotiating from a weaker footing. 'The alleged breach may add a bit more pressure to our position in negotiations. But ultimately, it depends on how our government handles the situation and works toward securing the best possible outcome. 'From the United States' perspective, Malaysia is not their major competitor. It is actively trying to diversify its supply chain risks – especially in light of tensions with China – and is looking for more allies and partnerships with other countries. Given Malaysia's 'neutral' stance and our geographical advantages, we could still be seen as a potential partner for the United States,' he said. Khaw said the construction sector's outlook remained optimistic with the order book environment set to improve heading into the second half of 2025.
