From left: Cheah, Abdul Hamid and Tahirah speaking during the press conference in conjunction with group’s prospectus launch
PETALING JAYA: Main Market–bound Orkim Bhd
, a tanker operator, expects to grow the company’s fleet to 21 vessels by 2027 in an expansion and renewal programme.
The company began as a third-party tanker operator before acquiring its own vessel, the Orkim Power, in 2009 for RM54mil.
Today, the company operates the country’s largest clean petroleum product (CPP) tanker fleet as well as operates liquefied petroleum gas (LPG) carriers, with a total of 18 vessels.
Its fleet transports refined petroleum products from refineries to terminals and distribution hubs across Malaysia and the region for final consumption.
Two newbuilds, the Orkim Jade and Orkim Ruby, would be up for delivery by early 2027, both backed by long-term contracts with Shell Malaysia, bringing the fleet to 20 vessels.
Another two vessels would be ordered next year immediately after the initial public offering (IPO), funded by a mix of IPO proceeds, internal funds and sukuk.
At the same time, an older vessel would be disposed next year, bringing the fleet to 21 vessels.
“By 2027, we expect to reach 21 vessels. And while the number seems modest, the tonnage growth is far more significant because we are replacing older, smaller ships with newer, larger vessels,” executive director and chief executive officer Cheah Sin Bi told StarBiz.
Cheah said the strategy of replacing smaller, older tankers with larger and more technically advanced vessels not only boosts transport capacity, but also enhances operating efficiency, allowing the company to command better charter rates.
“For Jade and Ruby, if we compare them with our existing vessels of similar size, the charter rates are about 25% higher,” he noted. Earlier this year, Orkim also took delivery of the Orkim Citrine, a 49,999 tonne medium-range (MR) tanker acquired for US$20.1mil.
The vessel carries a carbon intensity indicator rating of B, reflecting lower fuel consumption and reduced emissions compared with older conventional ships.
Cheah said “ecological vessels” like Citrine offer clear efficiency advantages, with lower energy consumption and carbon emissions.
According to the market report attached to the company’s IPO prospectus, Orkim commanded 56% share of the domestic market through its 15 CPP tankers, based on the entire domestic market having 27 Malaysian-registered tankers.
But in terms of total cargo carried in the Malaysian market, which includes foreign-flagged vessels, Orkim chairman Datuk Abdul Hamid Sh Mohamed said the company carried 12% of the total.
“While we hold around 56% market share from a vessel standpoint among Malaysian-flagged ships, the majority of cargo in this industry is still transported by foreign-flag vessels.”
He noted that this provides meaningful headroom for the company to grow, particularly in the context of the domestic cabotage policy, which restricts domestic shipping activities – including the transport of goods between two Malaysian ports, to Malaysian-flagged vessels.
Orkim’s IPO price of 92 sen per share aims to raise RM92mil from the public portion of its listing scheduled for Dec 9, 2025, giving the company an estimated market capitalisation of RM920mil.
Of the RM92mil raised, RM80mil or 87% will be used to purchase two new 9,000-deadweight tonne tankers within 24 months of listing.
Another RM1.15mil or 1.2% has been earmarked for working capital, while RM10.85mil or 11.8% will go towards listing expenses.
Its 18-vessel fleet has a combined capacity of 239,186 tonnes, comprising 14 coastal CPP tankers, two MR tankers and two LPG tankers, with an average age of 12 years.
Its fleet utilisation stood at 91.6% in the first half ended June 30, 2025 and 92% in the financial year ended Dec 31, 2024 (FY24).
As part of the IPO exercise, Orkim declared an interim dividend of two sen per share, totalling RM20mil, payable in January, with new IPO investors also entitled to the payout.
Chief financial officer Tahirah Mohd Nor said Orkim’s time charter order book totals RM615mil, with firm contracts and extensions running up to 2032, providing strong earnings visibility.
She added that voyage charters, which cannot be booked as order book, contributed 54% of FY24 revenue, with extensions running up to 2035. The company has a dividend policy of 50% to 70% of profit after tax.
