Stock Name: AIRPORT
Company Name: MALAYSIA AIRPORT HOLDINGS BHD
Research House: KENANGA
Malaysia Airports Holdings Bhd
(June 28, RM5.00)
Maintain trading buy at RM5 with higher target price of RM5.83 (from RM5.65): Malaysia Airports Holdings Bhd (MAHB) announced it had won the bid to build, operate, modernise and expand the Male International Airport (MIA) via its GMR-MAHB consortium.
The participants of the consortium are Aeroport De Paris (France-TAV, Turkey), Zurich Airport-GVK consortium and GMR-MAHB but there are still no details about MAHB's stake in the venture. While contribution may be minimal in the near term, not to mention higher business risks and additional requirement for investment cost, it is still in line with the group's long-term diversification objective.
Following the MIA project award, MAHB is looking to secure the expansion work for the Prince Mohammed Bin Abdulaziz Airport (Medina) in Saudi Arabia through a consortium. The total value of the project is estimated at RM4.9 billion and is planned for completion by 2016.
With the addition of MIA, MAHB will have four overseas airport operations ' the Rajiv Gandhi International Airport in Hyderabad (11% stake), the Indira Gandhi International Airport in New Delhi (10% stake) and the Sabiha Gocken International Airport in Turkey (20% stake). We expect contribution from this segment to be minimal in the near term, given the gestation period of three to five years before it can generate stable income.
At present, the management is looking to achieve 10% passenger growth in 2010 as reported. The strong traffic growth will yield a positive impact on its retail segment. In the meantime, we have not imputed any overseas business operations into our valuation, while being more optimistic on higher passenger movements and the company's existing domestic business. Higher traffic growth in April prompts us to revise our passenger-movement growth assumptions from 3% to 5% in FY2010, on the back of resilient air-travel demand from Asia Pacific. ' Kenanga Investment Bank Bhd Research.
We revise our earnings forecast upwards by 3% for FY2010 and FY2011 after imputing higher passenger growth at 5% for FY2010 from 3% previously, while pegging a 16 times price earnings FY2010 to derive a new target price at RM5.83. ' Kenanga Investment Bank Bhd Research
This article appeared in The Edge Financial Daily, June 29, 2010.
Company Name: MALAYSIA AIRPORT HOLDINGS BHD
Research House: KENANGA
Malaysia Airports Holdings Bhd
(June 28, RM5.00)
Maintain trading buy at RM5 with higher target price of RM5.83 (from RM5.65): Malaysia Airports Holdings Bhd (MAHB) announced it had won the bid to build, operate, modernise and expand the Male International Airport (MIA) via its GMR-MAHB consortium.
The participants of the consortium are Aeroport De Paris (France-TAV, Turkey), Zurich Airport-GVK consortium and GMR-MAHB but there are still no details about MAHB's stake in the venture. While contribution may be minimal in the near term, not to mention higher business risks and additional requirement for investment cost, it is still in line with the group's long-term diversification objective.
Following the MIA project award, MAHB is looking to secure the expansion work for the Prince Mohammed Bin Abdulaziz Airport (Medina) in Saudi Arabia through a consortium. The total value of the project is estimated at RM4.9 billion and is planned for completion by 2016.
With the addition of MIA, MAHB will have four overseas airport operations ' the Rajiv Gandhi International Airport in Hyderabad (11% stake), the Indira Gandhi International Airport in New Delhi (10% stake) and the Sabiha Gocken International Airport in Turkey (20% stake). We expect contribution from this segment to be minimal in the near term, given the gestation period of three to five years before it can generate stable income.
At present, the management is looking to achieve 10% passenger growth in 2010 as reported. The strong traffic growth will yield a positive impact on its retail segment. In the meantime, we have not imputed any overseas business operations into our valuation, while being more optimistic on higher passenger movements and the company's existing domestic business. Higher traffic growth in April prompts us to revise our passenger-movement growth assumptions from 3% to 5% in FY2010, on the back of resilient air-travel demand from Asia Pacific. ' Kenanga Investment Bank Bhd Research.
We revise our earnings forecast upwards by 3% for FY2010 and FY2011 after imputing higher passenger growth at 5% for FY2010 from 3% previously, while pegging a 16 times price earnings FY2010 to derive a new target price at RM5.83. ' Kenanga Investment Bank Bhd Research
This article appeared in The Edge Financial Daily, June 29, 2010.
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