PETALING JAYA: MBSB Research has cut its financial year ending March 31, 2027 (FY27) to FY28 earnings estimate by 7.1% to 9.3% for logistics firm Tasco Bhd
, mainly to reflect softer performance across ocean freight forwarding, cold chain and trucking.
The research house said the group’s management guides for the effective tax rate to be less than 20%, with the investment tax allowance benefits to be recognised in the fourth quarter.
Maintaining a “buy” call on the counter, it noted that Tasco’s core earnings for the first quarter ended June (1Q27) declined 21.7% quarter-on-quarter and 32.5% year-on-year, coming in below expectations at 18% and 15% of its and consensus full-year forecasts.
“Nonetheless, we expect earnings momentum to improve progressively in the coming quarters as conditions across its key business segments recover,” MBSB Research said.
Post-earnings revisions and the rollover of its valuation base year, the research house is lowering its target price on the stock to 49 sen from 56 sen, based on nine times FY28 earnings per share while valuation remains attractive.
MBSB Research said a shift from ocean to air freight for urgent cargoes was observed in the last quarter amid vessel shortages arising from the Middle East conflict, particularly for data centre cargoes.
Ocean freight rates ex-Malaysia rose sharply in June-July as carriers allocated capacity to higher-rate markets, it said, adding that management expects this trend to persist in the near term, with some customers already incorporating air-freight assumptions into 2027 project tenders.
“Separately, customers are pre-loading earlier amid freight uncertainty, making the traditionally 4Q peak season less predictable,” it said.
MBSB Research said the company’s new warehouses at Shah Alam Logistics Centre or SALC Phase 2 and Port Klang Logistics Centre or PKLC, with a combined capacity of 700,000 sq ft, are expected to come online this month, with roughly half the space earmarked for occupancy or internal consolidation.
This could temporarily shift the owned-to-leased warehouse mix towards 90:10, although management does not view this as the optimal long-term mix and intends to outsource incremental capacity to retain flexibility amid demand fluctuations, it said.
It noted existing mature facilities remain well utilised at around 90%.
MBSB Research also said cold supply chain profitability could remain below historical levels in the near term following the loss of a major ice-cream account, as Tasco rebuilds volumes through multiple smaller customers.
“As part of its consolidation efforts, the Westports cold chain facility has been temporarily closed, which could yield monthly cost savings of about RM200,000 to RM300,000,” MBSB Research said.
At last look, Tasco was at 39 sen apiece.
