Review

• Perak Transit (Ptrans) reported a core profit of RM53.1mn for 9M24, which was in line with ours and consensus estimates at 77% and 72% of full-year forecast respectively. The company declared a fourth interim dividend of 0.5sen/share, bringing the total FY24 dividend to RM2.25sen/share, which was a tad higher than the 2.0sen/share dividend (adjusted for bonus issue) paid last year.

• 9M24 core profit rose 11.1% YoY to RM53.1mn, underpinned by 8.6% growth in revenue and 9.3% reduction in tax expense. Specifically, the revenue from terminal operations (IPTT) soared 10.4% YoY to RM95.8mn due to higher contributions from project facilitation fees, rental income and revenue sharing from tenants. Note that at the comprehensive income levels, the profit more than doubled to RM101.9mn for 9M24 (vs. RM47.8mn for 9M23) due to a revaluation surplus of RM48.8mn recorded in 3Q24.

• QoQ, 3Q24 core profit was little changed at RM17.7mn despite higher revenue growth of 10.2%. This was due to increase in expenses, i.e., COGS (+17%), depreciation (+12%), and finance cost (+12%).

Impact

• No change to our FY24-26 earnings projections, pending management guidance at an analyst briefing today.

Outlook

• Recently, the company has obtained a letter of award from Pejabatan Setiausaha Kerajaan Negeri Kelantan in regards to the proposal for the implementation of the Terminal Kora Bharu Sentral development project. Ptrans shall appoint China Communications Construction Company as the main contractor for the project. We have not factored in this new development as information remains sketchy at this moment.

Valuation

• We maintain Ptrans’ SOP valuation at RM1.03/share (see Figure 1). Maintain Buy

Source: TA Research - 19 Nov 2024