Affin Hwang Research starts coverage of Westports with Buy call

AmResearch is maintaining its Buy on Westports

CMA CGM, which is Westports’ single-largest customer and largest member of the alliance, has designated Westports as its transshipment hub. 

“Our discounted cashflow-based target price of RM4.90 implies a 2017E PER of 24 times and EV/EBITDA of 16 times, which are higher than our comparable universe. 

“A premium valuation is warranted, in our view, given superior returns at more than 30% return on equity and strong free cashflow generation. We like Westports as an infrastructure pure play and as a proxy to rising consumption and industrialisation in Greater Klang Valley,” it said.