MCO takes toll on highway operators, revenue may fall 15% in 2020

File pic of the clogged up traffic along the LDP.

KUALA LUMPUR: The abrupt and significant impact on traffic volume during the four-week movement control order (MCO) will translate to lower revenue, a credit negative for toll road issuers, Maybank Investment Bank Research says.

It said on Friday revenue decrease could be around -15% YoY in 2020, assuming a -90% fall in traffic during the MCO from March 18 to April 14, followed by a gradual recovery after the MCO is uplifted and assuming traffic is -50% in the second month, -30% in the third month and 10% in the fourth month.