PETALING JAYA: MISC Bhd
is set to strengthen its long-term earnings profile as it continues investing in newer vessels to support growing liquefied natural gas (LNG) trade.
Its latest contract win is also expected to enhance the group’s operational efficiency, while reinforcing its position as a key transporter in the global energy supply chain.
RHB Research, for one, has reaffirmed its positive outlook on MISC after the group secured a letter of award for the long-term time charter of a newbuild 18,700 cubic m LNG carrier.
Charter commencement is expected in 2028.
The new vessel will support Petroliam Nasional Bhd’s (PETRONAS) continued LNG supply to Sendai City, Japan, while also forming part of MISC’s LNG fleet rejuvenation programme.
Separately, MISC has entered into a shipbuilding contract with Hudong-Zhonghua Shipbuilding (Group) to construct a vessel, but the financial terms were not disclosed.
RHB Research said: “We view the latest award to be largely within our expectations and consistent with MISC’s ongoing LNG fleet renewal strategy. The contract reinforces our long-term investment thesis, but does not alter our estimates.”
The research house maintained its “buy” recommendation and sum-of-parts-derived target price of RM9.71, implying an approximate 22% upside and a dividend yield of around 5%.
“The contract award marks another step in MISC’s LNG fleet rejuvenation programme through the deployment of a modern, fuel-efficient vessel,” it said.
The research house said the newbuild’s capacity of 18,700 cubic m is broadly comparable with MISC’s existing Aman-class LNG carriers, suggesting it is likely to replace one of the group’s ageing vessels operating on the Malaysia-Japan trade.
“Notably, Aman Sendai (built in 1997) has historically served the Bintulu-Sendai route and is among MISC’s legacy LNG vessels approaching charter expiry.
“However, MISC has not disclosed the vessel to be replaced,” it said.
According to the research house, replacing older tonnage should extend the group’s long-term contracted earnings visibility while improving operational efficiency through lower fuel consumption and reduced emissions intensity.
Looking ahead, the research house expects MISC’s gas assets and solutions segment to play a larger role in the group’s earnings mix.
“We continue to expect the gas assets and solutions segment to become broadly comparable with the petroleum segment in terms of revenue contribution over the medium term, supported by 19 vessel additions and stronger earnings contributions from seven fully-owned LNG carrier deliveries in 2026 to 2028,” it explained.
“Together with improving offshore contributions and resilient tanker fundamentals, these deliveries should further strengthen MISC’s long-term earnings profile,” it added.
