PETALING JAYA: With domestic trade surging and Malaysian ports hitting record volumes in 2025, Main Market-bound MTT Shipping and Logistics Bhd (MTTSL) is gearing up and betting on growth.
Despite disruption in global trade this year, the container liner operator is offering the public a stake in what it calls an “asset-backed” player at RM1.03 per share.
The initial public offering (IPO) comprises 633.5 million new shares, representing 25.3% of its enlarged share capital, raising RM652.5mil. Most of the proceeds will be used to expand its fleet and boost capacity to meet rising demand.
Its managing director Ooi Lean Hin said the group has no presence in the Middle East, and disruptions such as the Strait of Hormuz situation primarily affect oil prices, which are passed on to customers.
However, he said rising trade from production relocation, spurred by the long-running US-China trade war and global supply chain realignments, is driving growth.
“The China-US trade war is driving a lot of production relocation, a lot of supply chain realignments – that will benefit trade growth,” Ooi told StarBiz.
“Production is shifting to South-East Asia under the ‘China plus one’ strategy, and this is driving cargo flows within the region,” he said, adding that further growth is expected over the next 18 to 24 months as new manufacturing capacity comes onstream.
Ooi also pointed to Port Klang’s performance, which handled a record 15.14 million 20-foot equivalent units (TEUs) in 2025.
“We can see the growth is coming. But if we don’t have the capacity, we cannot take advantage of this growth,” he said.
Against this backdrop, MTTSL has committed to acquiring eight new container vessels worth about RM793.5mil, with deliveries scheduled between December 2026 and June 2028.
The group has already paid RM87.7mil, with a further RM65.9mil to be settled before listing. It has also earmarked RM402mil from its IPO proceeds to fund the balance RM639.9mil.
Four new vessels – two geared and two gearless ranging from 1,400 to 1,462 TEUs – will replace ageing ships, which average nearly 30 years in service.
“Geared vessels are essential for ports without functioning cranes, like Labuan. If your ship has no gear, you cannot discharge your cargo,” Ooi explained.
The remaining four vessels will support regional growth, including two 1,092-TEU dual-fuel vessels (backed with projects) and two 3,300-TEU ships, scheduled for delivery in March and June 2028.
By year-end, Ooi expects MTTSL’s fleet to reach 28 vessels following the addition of two chemical tankers scheduled for delivery in the second half of 2026.
Along with the delivery of additional ships, the total will rise to 30 by the end of 2027, before settling at 29 after off-hiring one chartered vessel.
Beyond these, the group is also exploring additional vessel acquisitions, depending on market opportunities, as part of its longer-term expansion plans.
Ooi said the group may begin ordering additional vessels as early as the second quarter of 2026, given typical construction lead times of 18 to 24 months.
“In shipping, you need assets. If you charter everything, you don’t make that kind of money,” he added. Each smaller 1,400-TEU vessel is estimated to cost about RM73.9mil, while larger 3,300-TEU vessels are priced at around RM164.2mil.
MTTSL is also balancing its expansion with a disciplined funding strategy, combining internal funds, borrowings and capital market instruments.
The group established a sukuk wakalah programme in 2023 comprising Islamic medium-term notes and Islamic commercial papers, with a combined limit of RM1.5bil.
To date, about RM425mil has been drawn to finance vessel acquisitions, with the programme rated AA3 by RAM Rating Services Bhd, leaving the group with about RM1.08bil in available headroom under the sukuk programme.
“We don’t want to over-gear the company. That’s why we are coming to market,” he said, noting that its current gearing is about 0.5 times, below the 0.7 times level advised by rating agencies.
MTTSL operates mainly within the feeder segment with vessels under 4,000 TEUs, serving regional ports rather than the large East‑West global routes dominated by bigger ships. It operates a fleet of 26 container vessels – 24 owned and two chartered – with a total capacity of 29,149 TEUs.
Of these, 15 vessels are self-operated while 11 are chartered out, with some earning up to US$29,400 per day in charter rates. Ooi said this positions the group to benefit from rising charter rates.
When charter rates go up, he said it’s a “win” for the group, adding that charterers typically pay 14 days in advance, with contracts ranging from six months to two years.
Still, freight income, from both domestic and international routes, accounts for almost 70% of the group’s topline, while vessel chartering contributes 21.6%.
Dry bulk shipping makes up another 5.3% of topline, container depot operations 3%, and other activities – including marketing and liquid bulk transportation services – account for the remaining 0.7%.
MTTSL’s fleet carries a wide variety of cargo, including rice, sugar, fertiliser, milk powder, construction materials, consumer electronics, and cars.
In the nine months ended Sept 30, 2025 (9M25), MTTSL transported 349,913 TEUs, with nearly 44% on domestic Peninsular Malaysia to Sabah and Sarawak routes.
It reported a revenue of RM961.4mil for 9M25, up from RM874.96mil in the previous corresponding period, while net profit rose to RM235.85mil from RM189.66mil.
About 35% of the group’s revenue comes from its freight income from Peninsular Malaysia to Sabah and Sarawak traffic, 5% from Sabah and Sarawak to West Malaysia, and 12.6% from intra-South-East Asia trade.
The group commands a profit after tax margin of over 20%, with about 24.5% in 9M25.
According to an independent market research report by Liner Research Services Pte Ltd, MTTSL is the largest domestic carrier in Malaysia based on cabotage volume handled between Peninsular Malaysia, Sabah and Sarawak, and Brunei, with a 46% market share in 2025.
“As at March 1, 2026, MTTSL’s fleet accounted for 47.2% of the Malaysian-flagged containership fleet by unit count and 61.3% by TEU capacity,” the report noted. It added that MTTSL has the youngest fleet among Malaysian operators, with an average age of 7.2 years.
MTTSL has targeted a dividend payout ratio of at least 50%. The group is slated to list on April 21.
