WPRTS (5246) : RHB Research maintains Buy on Westports
KUALA LUMPUR: RHB Research has maintained its Buy call on Westports with a higher target price of RM3.44, it said in a note on Monday.
The research house said Wesports is expecting a 5%-10% growth in container throughput in FY15.
It is also pushing for theupside tariff revision as well as the extension on investment tax allowance – the status of which remains unknown – to go through, it said.
However, RHB said the likelihood of Westports obtaining an extension on its investment tax – which expires this year – remains uncertain.
If the extension is approved, management said that the effective tax rate for FY15 could hover slightly below 20%. Otherwise, a 24% effective tax rate would be more likely.
"We have been conservative in our earnings estimate and have notimputed an investment tax allowance for 2015, as reflected in the low single-digit earnings growth for FY15F. Management currently has the next 12 months to make a case to obtain the extension.
"We understand that the tariff hike proposal has been given the green light by the Port Klang Authority, and is pending the final approval from the Ministry of Transport. Note that we have not factored in a tariff hike in our throughput forecasts," it said.
http://www.thestar.com.my
KUALA LUMPUR: RHB Research has maintained its Buy call on Westports with a higher target price of RM3.44, it said in a note on Monday.
The research house said Wesports is expecting a 5%-10% growth in container throughput in FY15.
It is also pushing for theupside tariff revision as well as the extension on investment tax allowance – the status of which remains unknown – to go through, it said.
However, RHB said the likelihood of Westports obtaining an extension on its investment tax – which expires this year – remains uncertain.
If the extension is approved, management said that the effective tax rate for FY15 could hover slightly below 20%. Otherwise, a 24% effective tax rate would be more likely.
"We have been conservative in our earnings estimate and have notimputed an investment tax allowance for 2015, as reflected in the low single-digit earnings growth for FY15F. Management currently has the next 12 months to make a case to obtain the extension.
"We understand that the tariff hike proposal has been given the green light by the Port Klang Authority, and is pending the final approval from the Ministry of Transport. Note that we have not factored in a tariff hike in our throughput forecasts," it said.
http://www.thestar.com.my
