KUALA LUMPUR, Oct 7 — Kenanga Investment Bank Research is maintaining its “neutral” outlook on the ports and logistics sectors on muted earnings from ports players due to risks emanating from the persistent COVID-19 pandemic.
In a research note today, Kenanga Research said sector earnings could be further dragged down amid the pandemic.
“With muted catalysts going forward, there could be potential derating on the back of a bleaker economic outlook, both globally and for Malaysia,” it said.
On Westports Holdings Bhd, the research house said weakened throughput volumes are expected, adding that, as the majority of the ships that call at Westports are from the Intra-Asia routes, the impact from possible future shutdowns and quarantines will likely hit throughput, though the extent is uncertain depending on the dynamics of the ongoing pandemic.
The research house is keeping its target price (TP) of RM3.65.
“Separately, for Pos Malaysia, the postal tariff hike on postage rates for registered and commercial mail failed to turn its earnings around to profitability in the second quarter of 2020,” it added.
Kenanga downgraded Pos Malaysia TP to 81 sen from 90 sen. -BERNAMA