MAHB to see conservative passenger growth in 2019


  • Business
  • Monday, 13 May 2019

KUALA LUMPUR: MIDF research has maintained its buy call on MALAYSIA AIRPORTS HOLDINGS BHD with a target price of RM8.90.

"We strongly believe that MAHB passenger numbers can surpass the 100m mark in 2019, while maintaining a relatively conservative growth rate of 3.5% at approximately 102.5m passengers," said MIDF following the release of its April passenger traffic numbers.

The research house said in a note that the visa relaxation for China passengers until end 2019 should sustain passenger growth for MAHB.

Additionally, MAHB's efforts in attacting more new airlines and offering increased connectivity will moderate the effects of the departure levy set for June 2019 for outgoing international passengers.

Meanwhile, low-cost carriers such as AIRASIA Group Bhd and AIRASIA X are strengthening their core markets while establishing new hubs in destinations such as Lombok. 

"This will continue to attract higher passengers in 2019 and will benefit MAHB."

For the month of April, passenger traffic grew the most in 10 months in MAHB airports excluding ISGA, rising 6.6% year-on-year to 8.8 million passengers. 
 
In the first four months of 2019 the passenger traffic rose 4.7% y-o-y to 34.2 million, making up 33.7% of MIDF's FY19 passenger traffic growth estimates of 102.5 million.

The research house said domestic traffic continues it upward trend with a 13.8% jump in airports ex-KLIA as airlines shifted their caapcity from the international to the domestic sector.

Meanwhile, international passenger traffic rose 2.5% y-o-y to 4.4 million passengers, the highest in five months, due to the Easter holidays in western countries. 

"It was also notable that the ratio of international to domestic passengers for Malaysian operations stood at 51:49 which bodes well for MAHB as the passenger service charge for
international passengers is higher compared to domestic passengers," said MIDF.
   

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