RHB Investment Bank Bhd (RHB Research) maintained its BUY call on TASCO Bhd and raised its target price to RM0.66 from RM0.61, implying 74% upside and around 4% FY27F dividend yield, despite the logistics provider reporting weaker-than-expected first-quarter earnings. The research house expects a stronger performance in 2HFY27, supported by new warehouse contributions and improving logistics demand.
TASCO’s 1QFY27 core earnings fell 29% year-on-year and 23% quarter-on-quarter to RM7.2 million, accounting for around 15% to 16% of RHB Research’s and consensus full-year forecasts. The weaker results were mainly due to softer ocean freight forwarding, contract logistics and cold supply chain operations, partly offset by stronger air freight forwarding performance.
Revenue, however, increased 10.2% year-on-year and 6.5% quarter-on-quarter to RM245.2 million, driven by higher air freight forwarding volumes. RHB Research noted that elevated global ocean freight rates amid Middle East tensions encouraged customers to shift towards air freight, supporting the segment’s stronger showing.
MBSB Investment Bank Bhd (MBSB Research) also maintained its Buy recommendation with an unchanged target price of RM0.56, noting that freight forwarding could improve as more transactions move towards spot rates amid ongoing market volatility.
Looking ahead, RHB Research expects TASCO’s new facilities, including the 400,000 sq ft expansion at Shah Alam Logistics Centre and the 300,000 sq ft warehouse at Northport, to contribute from 2HFY27. The research house also highlighted the upcoming regional semiconductor hub in Penang, which is expected to begin operations in July 2026, as another potential growth driver.
RHB Research said TASCO’s valuation remains attractive at around 6 times FY27F price-to-earnings, below its five-year average of about 10 times.
As of 10.26 am, the stock price slips 1.32% to RM0.375.
