Latest news with #Westports
The Star
a day ago
- Business
- The Star
Trade tariff risks likely to affect Westports
TA Research said it is keeping its financial year 2025 (FY25) to FY27 earnings forecast unchanged. PETALING JAYA: Westports Holdings Bhd is likely to report a profit of between RM420mil and RM475mil for the first half of financial year 2025 (1H25). In a note, TA Research said the projected amount accounted for 45% to 50% of its full-year forecast. Westports will be releasing its results for the second quarter of financial year 2025 (2Q25) tomorrow. 'In general, we expect 2Q25 key operating metrics to track the trade performance of Malaysia and China during the period. 'As such, we project Westports' 2Q25 gateway and transhipment volume to be around 1.2 million to 1.25 million and 1.53 million to 1.58 million twenty-foot equivalent units, respectively, by referring to Malaysia and China's respective trade growth of 6.1% and 4.5% year-on-year in 2Q25. 'We keep our financial year 2025 (FY25) to FY27 earnings unchanged at this juncture and maintain Westports' FY25 transhipment and gateway volume growth assumptions of 3% and 2%, respectively, pending the tariff outcome soon,' it said. TA Research was hopeful that the government would secure a favourable deal with the United States on the tariffs, although the odds appeared slim. Should negotiations fall through, the research house said the looming 25% export tariff would significantly undermine Malaysia's trade competitiveness, putting the country at a distinct disadvantage. 'More critically, we expect tariff-inflated US imports would dampen consumer spending in the fourth quarter of this year, particularly given that many consumers likely stocked up during the 90-day tariff reprieve.' US President Trump had indicated that all countries would face tariffs ranging from 15% to 50%. 'As such, Malaysia would be able to minimise the impact from the structural change only if the tariff is set at the 20% levels or near its peers namely Vietnam (20%), the Philippines (19%), Indonesia (19%), Japan (15%) and the European Union (15%). 'As the access to United States' high-tech chips and China's rare earth minerals and magnets would remain the key concerns of both countries and subject to export restrictions, we believe the rule of origin would also be applied to Malaysian exports as the country is one of the important transhipment hubs in the Strait of Malacca. 'In other words, higher tariffs could be imposed on goods transhipped through Malaysia like the trade deal between the United States and Vietnam, which includes a 40% tariff on transhipment.' TA Research has downgraded its rating on Westports to a 'sell', ahead of the looming risk from the trade tariff. However, it maintained Westports' target price at RM5.57 per share. 'As the share price has appreciated by 22% since the port tariff hike announcement, we believe the market has fully priced in the positive impact from port tariff adjustment,' according to the research house.
The Sun
14-07-2025
- Business
- The Sun
Westports could make it into FBM KLCI at next review: CIMB Securities
KUALA LUMPUR: Westports Holdings Bhd could replace Sime Darby Bhd in the upcoming review of the FTSE Bursa Malaysia KLCI (FBM KLCI) as its market capitalisation (market cap) ranking has risen to 24th among eligible securities, surpassing the eligibility threshold of the 25th largest. The next FBM KLCI review outcome announcement is scheduled for Dec 4, and will be based on closing share prices on Nov 24. Any changes to index constituents will take effect on Dec 22. CIMB Securities noted that based on closing market data as of July 10, Westports has risen to 24th position in market cap among eligible Main Market securities. 'The company could potentially be added to the KLCI in the next review, provided it retains a ranking of 25th or higher among eligible securities as of Nov 24, the cut-off date. 'Currently, the market cap gap between Westports and Nestlé Malaysia (the 26th-ranked eligible security) stands at 6.3%. If Westports is added, we believe Sime Darby, which currently has the lowest market cap among existing KLCI constituents, could be removed to make room,' it said in a research note today. CIMB Securities noted that in addition to meeting the market cap requirement, securities must have a free float of at least 15% and pass a liquidity screening test to qualify for inclusion in the FBM KLCI. Port operator MMC Port Holdings Bhd has reportedly moved closer to what could be Malaysia's largest initial public offering in 13 years, following the submission of a draft prospectus to the Securities Commission, as published on the regulator's website. According to the FTSE Bursa Malaysia Index Series Ground Rules, a newly listed company may qualify for inclusion in the FBM KLCI if its full market cap is at least 2% of the total market cap of the FBM Emas Index, based on the closing price on its first trading day. 'If this condition is met, the stock will be added to the KLCI at the close of its fifth trading day. As of Jul 10 2025, the FBM Emas Index market cap stands at RM1,626.6 billion, implying that an IPO with a market cap of at least RM32.53 billion would meet the fast-entry threshold,' said CIMB Securities. It added that potential changes in the FBM KLCI could spur increased interest in stocks likely to be included, driven by passive fund inflows, while stocks at risk of exclusion may face selling pressure. The FTSE and Bursa Malaysia are scheduled to release the preliminary results of the FBM KLCI review on Dec 3, via a technical notice, one day ahead of the official announcement on Dec 4. Since the last review, YTL Corporation Bhd, YTL Power International Bhd and Axiata Group Bhd have recorded the largest increases in market cap among FBM KLCI constituents. Conversely, Sime Darby, PPB Group Bhd and RHB Bank Bhd have registered the most significant declines. As of June 30, the financial services sector accounted for the largest weighting in the FBM KLCI at 41.1%, followed by the utilities sector at 17.6% and the telecommunications sector at 9.8%. – Bernama
The Star
14-07-2025
- Business
- The Star
Westports may potentially replace Sime Darby in upcoming KLCI review
KUALA LUMPUR: Westports Holdings Bhd could potentially replace Sime Darby Bhd in the upcoming FTSE Bursa Malaysia KLCI (FBM KLCI) review, as its market capitalisation (market cap) ranking has risen to 24th among eligible securities, surpassing the eligibility threshold of the 25th-largest market cap. The next FBM KLCI review announcement is scheduled for Dec 4, 2025 and will be based on closing share prices as of Nov 24, 2025. Any changes to the index constituents will take effect on Dec 22, 2025. CIMB Securities noted that based on closing market data as of July, 10, 2025, Westports has risen to 24th position in market cap among eligible Main Market securities. "The company could potentially be added to the KLCI in the next review, provided it retains a ranking of 25th or higher among eligible securities as of Nov 24, the cut-off date. "Currently, the market cap gap between Westports and Nestlé Malaysia (the 26th-ranked eligible security ) stands at 6.3 per cent. If Westports is added, we believe Sime Darby, which currently has the lowest market cap among existing KLCI constituents, could be removed to make room," it said in a research note today. In addition to meeting the market cap requirement, CIMB Securities noted that securities must have a free float of at least 15 per cent and pass a liquidity screening test to qualify for inclusion in the KLCI. Port operator MMC Port Holdings Bhd has reportedly moved closer to what could be Malaysia's largest initial public offering (IPO) in 13 years, following the submission of a draft prospectus to the Securities Commission, as published on the regulator's website. According to the FTSE Bursa Malaysia Index Series Ground Rules, a newly listed company may qualify for inclusion in the KLCI if its full market cap is at least two per cent of the total market cap of the FBM Emas Index, based on the closing price on its first trading day. "If this condition is met, the stock will be added to the KLCI at the close of its fifth trading day. As of Jul 10 2025, the FBM Emas Index market cap stands at RM1,626.6 billion, implying that an IPO with a market cap of at least RM32.53 billion would meet the fast-entry threshold," said CIMB Securities. It added that potential changes in the KLCI could spur increased interest in stocks likely to be included, driven by passive fund inflows, while stocks at risk of exclusion may face selling pressure. The FTSE and Bursa Malaysia are scheduled to release the preliminary results of the KLCI review on Dec 3, 2025, via a technical notice, one day ahead of the official announcement on Dec 4, 2025. CIMB Securities said any changes to the index constituents would take effect on Dec 24, 2025. Since the last review, YTL Corporation Bhd , YTL Power International Bhd , and Axiata Group Bhd have recorded the largest increases in market cap among KLCI constituents. Conversely, Sime Darby, PPB Group Bhd , and RHB Bank Bhd have registered the most significant declines. As of June 30, 2025, the financial services sector accounted for the largest weighting in the KLCI at 41.1 per cent, followed by the utilities sector at 17.6 per cent, and the telecommunications sector at 9.8 per cent. - Bernama
Malay Mail
07-07-2025
- Business
- Malay Mail
Westports gets cargo lift from Gemini shift, trade turmoil
KUALA LUMPUR, July 7 — Westports Holdings Bhd's container volumes are estimated to be higher in the second quarter of 2025 (2Q 2025) compared to 0.6 per cent recorded in the 1Q 2025 due to the start of the Gemini Cooperation shipping alliance from Feb 1, 2025, according to CGS International Securities Malaysia Sdn Bhd (CGS MY). It said the volume growth resulted in a one-off boost to Westports' trans-shipment (t/s) volume in the first three months of 2025, as Hapag-Lloyd reshuffled its boxes when it joined Gemini and got a permanent boost to Westports' t/s volumes. 'Two of Evergreen's container shipping services were relocated to call at Westports instead of Port of Tanjung Pelepas (PTP) from April 1, 2025 (Evergreen relocated five services from PTP to the Port of Singapore),' it said in a research note today. CGS MY said Evergreen's move was directly linked to the higher t/s volumes that Gemini's Maersk and Hapag-Lloyd have given to PTP due to Gemini's transition to the hub-and-spoke model. It also opined that Westports' t/s volumes for 2Q 2025 were boosted by the US trade war with China, which started on April 2, 2025, but was largely suspended for 90 days on May 14, 2025. It added that the collapse in US-China trade in April caused shipping lines to redeploy their vessels to other trades, but US-China shipping capacity was reinstated after mid-May as US import demand returned. 'The whiplash vessel deployments resulted in greater t/s moves at both Port Klang and Singapore, according to Westports,' it said. CGS MY said a modest 3.4 per cent year-on-year (y-o-y) recovery to 11.19 million t/s in 2026 is expected, further accelerating to 5.5 per cent y-o-y to 11.80 million t/s in 2027, as manufacturers' efforts to move production out of China to Southeast Asia in light of the US trade war against China would begin to positively impact Malaysia's containerised volumes. 'Y-o-y growth in Average Revenue Per Teu (ARPT) and sequentially stronger container volumes in 2Q25F to be potential share price rerating catalysts for Westport,' it said. Meanwhile, CGS MY stated that the 15 per cent rise in port charges from July 15, 2025, would also boost Westports' 3Q 2025 results. 'Downside risks include the potential for the US to resume punitive trade tariffs on global economies (ex-China) after the 90-day reprieve ends on July 8, 2025, and a possible global recession that could impact the volumes on all container trade routes,' it added. — Bernama
New Straits Times
04-07-2025
- Business
- New Straits Times
Port charges hike, container volume growth to boost Westports' Q3 earnings
KUALA LUMPUR: Westports Holdings Bhd's third-quarter 2025 (3Q25) results are expected to benefit from the 15 per cent increase in port charges effective July 15, according to CGS International. In a note, the firm said the anticipated year-on-year (YoY) growth in average revenue per twenty-foot equivalent unit (ARPT), coupled with sequentially stronger container volumes in 2Q25, could serve as potential share price re-rating catalysts for Westports. "The 15 per cent rise in port charges from July 15 will also boost 3Q25 results, which is why we reiterate 'Add' on Westports," it said. CGS has raised its target price to RM6.41, citing expectations of stronger storage income amid sustained high yard utilisation. It also noted that Westports' yard utilisation remained elevated at 90 per cent or higher during the first half of 2025 (1H25). This was partly due to a government crackdown on illegal e-waste and metal waste imports since 2024. The stricter customs checks have caused an estimated 5,000 to 6,000 containers to remain stranded at Westports' yard, some for up to 60 days. These containers are expected to either be cleared for entry into Malaysia or re-exported to their ports of origin. If importers cannot be identified, Westports will recover storage charges from the shipping lines. CGS said this backlog contributed to a 4.3 per cent YoY increase in ARPT in 1Q25 and expects the positive trajectory to have continued into 2Q25. Meanwhile, CGS also believes that container volume growth in 2Q25 likely exceeded the modest 0.6 per cent YoY growth seen in 1Q25. This was driven by the launch of the Gemini Cooperation shipping alliance on Feb 1, which led to changes in shipping routes and cargo flows that boosted Westports' transshipment volumes. In April, Evergreen shifted two of its container services from Port of Tanjung Pelepas to Westports, contributing further to sustained volume gains. On the impact of the US-China trade war, CGS said shipping lines had initially diverted vessels to alternative routes, but restored capacity between the two countries as US demand rebounded after mid-May. These abrupt changes in vessel deployment contributed to higher transshipment activity at Port Klang and Singapore, according to Westports. Despite the positive developments, CGS cautioned that downside risks remain for the group. These include the threat of a global recession that could weigh on container trade volumes, and the possibility of the US reintroducing punitive trade tariffs on global economies, excluding China, once the current 90-day reprieve ends on July 8. CGS has lowered its cost of equity assumption for Westports to 8.2 per cent from 9.4 per cent, citing a lower risk profile for the group following improved clarity on future port charges.
