CIMB Securities has initiated coverage on MTT Shipping and Logistics Bhd with a BUY call and target price of RM1.80, citing the group’s RM2 billion expansion programme, strong domestic shipping position and growing exposure to intra-Asia trade.
The target price, based on 11 times FY27 forecast earnings, represents a potential upside of 63.4% from the RM1.10 share price referenced in CIMB’s Sept 17 initiation report.
The research house expects MTT’s core net profit to grow at a compound annual growth rate of 18.1% between FY25 and FY28, supported by fleet expansion, higher container volumes, rising charter income and integrated logistics development.
MTT is Malaysia’s largest Malaysian-flagged container liner operator by capacity, with an estimated 45% share of domestic cabotage container volumes in 1H26.
Its network covers 13 major Malaysian ports and 21 regional ports across Southeast Asia, China and India.
CIMB said the group’s relatively young fleet, with an average vessel age of approximately 7.3 years compared with more than 20 years for domestic peers, provides an advantage in fuel efficiency, maintenance costs and regulatory compliance.
Fleet Capacity To Nearly Double By 2029
The centrepiece of MTT’s growth strategy is a planned investment of approximately RM2 billion between FY26 and FY29, including the acquisition of 12 new container vessels.
Six larger vessels, each with a capacity of 3,300 twenty-foot equivalent units (TEUs), are intended to expand its intra-Asia operations, while six smaller vessels will support fleet renewal and domestic services.
CIMB estimates the additions will increase the group’s container fleet capacity by 95%, from 29,087 TEUs in 2025 to 56,795 TEUs by 2029.
The group is also diversifying into energy logistics through two chemical tankers targeted for delivery in the fourth quarter of 2026, providing exposure to Sarawak’s oil and gas-related transport requirements.
Meanwhile, investments in integrated freight facilities in East Malaysia and Port Klang are expected to improve cargo handling, reduce empty container movements and strengthen MTT’s end-to-end logistics capabilities.
Tight Supply Supports Charter Income
CIMB expects MTT to benefit from a structural shortage of smaller container vessels, particularly those below 4,000 TEUs.
While global shipbuilding has concentrated on larger vessels, smaller feeder ships remain essential for domestic and regional trade, especially in Southeast Asia, where port conditions often limit vessel size.
MTT currently has 10 vessels on time charter, with charter renewals secured at rates 9% to 25% higher since 4Q25, according to the report.
CIMB believes continued demand for modern feeder vessels could support charter income and provide additional earnings resilience as MTT expands its regional network.
The research house forecasts core net profit increasing from RM289 million in FY25 to RM332 million in FY26, RM409 million in FY27 and RM477 million in FY28.
Revenue is projected to rise from RM1.28 billion in FY25 to RM1.81 billion by FY28.
Based on an assumed 50% dividend payout ratio, CIMB expects dividend yields of 6.0% to 8.7% over FY26–FY28.
Key risks to the outlook include delays in vessel deliveries and logistics projects, cost overruns, higher financing costs and weaker shipping market conditions.
