MISC yesterday announced 9MFY20 core net profit of RM1.7bil, which came in within expectations at 75% of Kenanga's and 79% of consensus full-year estimates.
Its dividend payout of seven sen per share also came within expectations, bringing year-to-date dividend to 21 sen per share.
The research house anticipates weak spot rates to persist given the weak oil trade volumes coupled with supply side pressure from excess tonnage capacity.
According to Kenanga, 65% of MISC's petroleum fleet and almost all of its LNG fleet are on term charters, which would provide a steady stream of recurring income and would be largely unaffected by the fluctuations of the spot market.
MISC is also expecting the deliveries of another seven LNG vessels and two petroleum vessels until 1HFY21, which will further boost the group's sustainable and recurring income streams, it said.
"Post-results, we opt to conservatively trim our FY20E/FY21E by 11%/2%, as we lowered our petroleum shipping contribution assumptions, in light of the weakened spot rates," said Kenanga.
It maintained its target price at RM8.90 per share and continues to like MISC as a defensive blue-chip play given its reliable and consistent dividend payouts with about 4% yields.
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