PETALING JAYA: Westports Holdings Bhd
has maintained its low single-digit container throughput growth guidance for 2026.
The port operator’s structural revenue and earnings growth remains well-supported by sequential container tariff hikes, including a 15% increase in July 2025, a 10% increase in January 2026, and a scheduled 5% hike taking effect in January 2027, analyst reports noted.
Long-term expansion is driven by the Westports 2 mega project (Container Terminals CT10 to CT17), which will nearly double the port’s container handling capacity from 14 million to 28 million twenty-foot equivalent units (TEUs) by the late 2030s.
Land reclamation and dredging for CT10 to CT13 reached 71% completion as of end-September, with CT10’s first 300m wharf scheduled to commence operations in the third quarter of financial year 2028 (3Q28).
“Westports lowered its financial year 2026 (FY26) capital expenditure (capex) guidance to below RM800mil (from RM890mil previously), but indicated that FY27 capex could rise to around RM1.5bil, mainly driven by the Westports 2 expansion project.
“To fund the capex, Westports had issued RM605mil in sukuk this year, with a further RM200mil potentially to be raised by end-2026.
“According to the company, additional sukuk issuance could fund about half of FY27’s capex,” CGS International (CGSI) Research stated in a report on the company.
To support sustainability and operational flow, Westports has taken delivery of 60 electric trucks, subscribed to Green Electricity Tariffs and expanded its total ground slots to effectively manage yard density.
Westports reported 3Q26 core earnings of RM348.3mil (minus 2.6% quarter-on- quarter, 30.3% year-on-year or y-o-y), taking the first nine months of the financial year 2026 (9M26) tally to RM1bil (43.9% y-o-y rise).
Hong Leong Investment Bank (HLIB) Research expects traditionally stronger volume in 4Q26, noting that earnings growth for FY26 so far was driven by sustained throughput volume with tariff hikes alongside higher value-added services (VAS) income.
Meanwhile, 9M26 operating revenue grew 26.4% y-o-y to RM2.36bil, bolstered by cumulative tariff adjustments and higher VAS revenue.
Total container volume rose to 8.55 million TEUs (1.3% y-o-y rise), driven by transhipment throughput (2.1% y-o-y increase to 4.92 million TEUs)
The conventional cargo segment performed exceptionally well, with revenue surging 40.8% y-o-y to RM169mil on a 10.7% volume growth to 10.18 million tonnes.
Broker consensus remains generally positive on Westports’ strong cash flows and tariff protection, with target prices (TPs) for the stock ranging from RM6.74 a share to RM8 against its stock price of RM6.99.
CGSI Research has reiterated an “add” call on the stock with a TP of RM8 a share, supported by sustained tariff gains and CT10 operationalisation in 2028 as key re-rating drivers.
HLIB Research also maintained a “buy” call on Westports with a TP of RM7.55 a share, citing resilient container throughput and further upside from the 2027 tariff hike.
UOB Kay Hian Research kept a “hold” call on the stock with a TP of RM7 a share, noting that strong operational yield gains are largely reflected in the stock price until Westports 2 capacity comes online.
Moreover, MBSB Research has a “neutral” recommendation on Westports with a TP of RM6.74, pointing out that the stock currently trades near its five-year historical mean valuation.
In terms of valuation multiples, Westports trades at a forward FY26 price earnings ratio of 16.7 times to 17.5 times and offers a defensive forward dividend yield of 4.2% to 4.5% anchored by its historical 75% dividend payout policy.
