‘NEW RAIL LINK BIG BOON FOR ATLAN’
Plan to link Penang and Songkhla ports may increase economic activities at Bukit Kayu Hitam, spending at The ZON outlet
THE government’s plan to build a railway line linking the sea ports of Penang and Songkhla in Thailand will speed up economic activities in the northern region, said Maybank Investment Bank Bhd (Maybank IB).
“We are positive on this proposal as it would help speed up economic activities in the northern part of the peninsula. A major highway or railway line would also help lift the movement of people (besides cargo) and tourism activities,” said the research house in a report.
The proposal was mooted during Second Finance Minister Datuk Seri Johari Abdul Ghani’s visit to Thailand last month.
Maybank IB said if the proposal became a reality, both countries were expected to see a good flow of goods and containers between Songkhla Port and Penang Port, bypassing the busy Straits of Malacca, and this could also replace the proposed Kra Canal at southern Thailand.
Maybank IB said the proposal to better connect Penang Port with Songkhla Port could also benefit Bukit Kayu Hitam.
It said the expected increase in economic activities should be long-term positive for Atlan Holdings Bhd as its The ZON duty free outlet sits on a huge 312.4ha site that had been earmarked for a major development.
“For Atlan, it would benefit from higher spending at its duty free outlet in Bukit Kayu Hitam, sandwiched between the Thai and Malaysian Customs and Immigration checkpoints. It could also help kick-start a major development on the land where its duty free outlet sits.
“Besides Bukit Kayu Hitam (in Kedah), Atlan also has duty free outlets at the other towns bordering Thailand — at Padang Besar (Perlis), Pengkalan Hulu (Perak) and Rantau Panjang (Kelantan),” it said.
Maybank IB has retained its “buy” call on Atlan with an unchanged target price of RM6.