Pos Malaysia in focus as it gets ready to unleash Tigers Global strategic plan

Pos Malaysia to help deliver stronger earnings for DRB-Hicom

PETALING JAYA: Pos Malaysia Bhd continued to attract interest as investors chased up the national courier’s shares by six sen to close at RM4.76 yesterday.

Pos Malaysia will be announcing today its plans for a “strategic business collaboration for a regional e-fulfilment hub in Kuala Lumpur International Airport (KLIA)” that involves a company called Tigers Global Logistics Sdn Bhd.

Pos Malaysia shares have been rallying since the launch of the Digital Free Trade Zone about two weeks ago.

Pos Malaysia shares are now at a 12-month high, giving it a market capitalisation of RM3.73bil.

An analyst, however, noted that Pos Malaysia shares are currently at a “steep valuation”.

The stock is trading at a price earnings (PE) multiple of 33.6 times, with a forward PE of about 39 times.

“Shares of many logistics and courier companies have rallied since the Alibaba Group announced its plans to set up an e-commerce and logistics hub here in Malaysia,” he said.

“People are expecting the deal with Alibaba to materialise.

“And if the deal goes through, there is a huge chunk of e-commerce related business waiting to be rolled out to logistics players, with Pos Malaysia being one of the beneficiaries via its wholly-owned unit Kuala Lumpur Airport Services Sdn Bhd,” he said.

Kuala Lumpur Airport Services Sdn Bhd, or better known as KLAS, currently operates at KLIA and provides, among others, aviation ground services, logistics services and inflight catering services.

Pos Malaysia acquired a 100% stake in KLAS from its parent company DRB-Hicom Bhd in September 2016.

The deal was settled with the issuance of new Pos Malaysia shares to DRB-Hicom.

Following the acquisition, Pos Malaysia, which was mainly a retail-centric business previously, is said to own a high portion of contributions from various industries and manufacturers.

With the acquisition of KLAS, Pos Malaysia will also have more synergistic opportunities for the postal business in the e-commerce fulfilment area.

Not many details are available on Tigers Global Logistics (M) Sdn Bhd.

However, according to its website, Tigers Global Logistics is involved in airfreight operations at KLIA.

It is part of Tigers Ltd, a US$700mil company headquartered in Hong Kong specialising in global supply chain solutions.

Earlier, Pos Malaysia said it expects the company’s e-commerce segment to contribute about RM1bil to revenue this year, compared with the RM738mil in revenue generated by the segment last year.