CIMB Securities Projects Stronger Throughput Growth For Westports In 2025 On Transhipment Recovery
KUALA LUMPUR, Nov 11 (Bernama) -- CIMB Securities Sdn Bhd expects stronger throughput volume growth in 2025 for Westports Holdings Bhd driven by a recovery in transhipment volumes and sustained gateway cargo volumes.
It anticipated a low single-digit growth in the group’s throughput volume in 2025, driven by transhipment recovery as congestion eases and volumes normalise following the phase-out of Israel-based shipping company -- ZIM Integrated Shipping Services Ltd’s volume in 2024.
“We also expect continued healthy gateway cargo volumes, supported by a robust economic outlook and strong trade performance,” it said in a note.
The research house said the group highlighted the potential for increases in cargo demand as importers look to bring in goods ahead of possible new tariffs following the United States presidential election, which could provide a short-term boost to Westports’s throughput.
Earlier, Westports Holdings announced a higher net profit of RM233.07 million in the third quarter ended Sept 30, 2024 (3Q 2024), compared to RM195.0 million a year ago, while revenue for the quarter rose to RM572.57 million versus RM542.31 million previously.
For the nine months, Westports’s net profit increased to RM641.33 million, up from RM573.35 million in the same period last year, while revenue climbed to RM1.67 billion from RM1.60 billion, a growth driven by a higher container volume of 8.11 million Twenty-Foot Equivalent Units.
Meanwhile, Hong Leong Investment Bank Bhd (HLIB) said Westports’s terminals continued to experience yard congestion during the 3Q 2024 beginning at the end of March due to the spillover impact from the port congestion in Singapore -- some of the transhipment containers to Singapore were redirected to Westports.
“Management highlighted its ongoing exercise to ease yard congestion and become more selective in allocation towards gateway containers.
“Transhipment volume in the nine months of 2024 (9M 2024) contracted by 5.3 per cent year-on-year (y-o-y), affected by the ongoing yard congestions and loss of ZIM container shipping line,” it said.
Nonetheless, HLIB noted that gateway volume continues to show robust growth, with the 9M 2024 volume rising 10.3 per cent on stronger imports driven by ongoing economic growth and strong foreign direct investment inflows.
In addition, MIDF Amanah Investment Bank Bhd expects Wesports’s container volume to end flat in 2024, as shifts in transhipment congestion and subdued market conditions have dampened growth momentum.
It said this largely aligns with its 1.2 per cent y-o-y growth estimate.
“They have guided for low single-digit growth in 2025, driven by strong gateway volume and recovery in transhipment volume, which we translate into a 3.3 per cent y-o-y growth.
“Container volume could see a temporary rise if shipments are frontloaded in anticipation of trade tariffs following Donald Trump’s presidential transition, though the impact will depend on the scope of the tariffs,” it said.
The bank noted that the “China+1” strategy has been a key driver of gateway volume growth, particularly from the paper, glass, and solar industries.
CIMB Securities and HLIB retained the “buy” call with target prices (TP) of RM5.30 and RM5.00, respectively, while MIDF maintained its “neutral” call with an unchanged TP of RM4.30.
-- BERNAMA
