KUALA LUMPUR (Feb 14): AmInvestment Bank anticipates the Chinese New Year to boost the arrival of Chinese tourists to Malaysia, benefiting the country’s tourism industry, especially the transportation and logistics sector.

In an update on Wednesday, the research house maintained its "overweight" stance on the sector, and named Malaysia Airports Holdings Bhd or MAHB ("buy"; fair value or FV: RM8.07), and Perak Transit Bhd ("buy"; FV: RM1.49) as its top picks.

According to AmInvestment, MAHB is poised to benefit from the recovery within the aviation sector in 2024, with foreign tourist arrivals beating pre-pandemic levels on the back of stronger government policy support, such as the mutual visa waiver agreements between China and selected countries, including Malaysia.

“We gather from Malaysian Aviation Commission that China-related routes, including KUL-HKG (Hong Kong International Airport) and KUL-PVG (Shanghai Pudong International Airport), may see the largest increases in capacity for 2024, along with Loongair’s KL-HGH (Hangzhou Xiaoshan International Airport), China Eastern Airlines’ KCH/KUL-NKG (Nanjing Lukou International Airport), and AirAsia X’s KUL-XIY (Xi’an Xianyang International Airport),” AmInvestment added.

Meanwhile, for Perak Transit, the research house opined that the company offers a stable investment (defensive) because of its involvement in public infrastructure, which typically has steady demand.

“The company is experiencing growth due to increased use (occupancy and foot traffic) of its facilities at Terminal Meru Raya and Kampar Putra Sentral, and the company is expected to start earning revenue from Terminal Bidor Sentral in the first half of fiscal year 2024,” AmInvestment said.

In addition, AmInvestment also noted that Perak Transit has been making efforts to reduce its carbon footprint by adopting solar energy and planning to replace its diesel buses with electric ones.