PETALING JAYA: MISC Bhd
is well positioned to benefit from structural growth in tanker demand, driven by rising crude oil exports from the Americas and sustained demand from Asia and other key consuming regions, which supports longer shipping distances and elevated tanker rates, according to BIMB Research.
The research company in a note to clients said MISC’s subsidiary AET, a niche leader in the specialised tanker segment, stands out, given its focus on specialised shipping services, particularly in areas where fewer competitors have the required technical skills and experience.
These include ship-to-ship operations, where oil is safely transferred between vessels and shuttle tankers that transport crude oil from offshore oil fields to export terminals.
Meanwhile, the disruption in the Strait of Hormuz resulted in an increase in tonne-mile demand – a key driver of tankers earnings – leading to tanker rates remaining resilient and boosting first quarter of 2026 earnings.
AET maintains a diversified contract portfolio, with around 70% of revenues secured across varying durations ranging from short-term contracts to multi-year charters extending into the mid-2030s.
This is complemented by spot and floating-rate exposure, allowing the company to benefit from upside during market upcycles.
Notably, even part of its contracted revenue includes market-linked components, reflecting a deliberate strategy to blend stability with opportunistic earnings capture.
Furthermore, MISC’s management emphasised that the mix between spot and term exposure is actively managed rather than fixed.
While higher spot exposure is preferred in stronger markets, a greater focus on term contracts is maintained during weaker cycles in order to preserve earnings visibility.
Looking ahead, BIMB Research said that a potential normalisation in Middle East flows may lead to some softening in freight rates, especially for very large crude carriers.
However, MISC’s management believes this could be offset by inventory restocking, particularly from large consumers such as China.
As inventories were drawn down during recent disruptions, a rebound in stock-building activities could provide incremental tanker demand, the research house added.
Overall, BIMB Research maintained its “buy” call on MISC with an unchanged target price of RM9.80.
The research house said it favours MISC due to its benefits from robust floating production storage and offloading demand, recurring income from its asset-leasing business model and decent dividend yield of about 4% to 5%.
