GDEX a prime beneficiary of e-commerce growth
KUCHING: GD Express Carrier Bhd (GDEX) has been viewed as a prime beneficiary of ecommerce growth, especially as Malaysia is set to become a regional e- commerce hub.
According to the research arm of MIDF Amanah Investment Bank Bhd ( MIDF Research), GDEX is a prime beneficiary of e- commerce growth as a pure play courier service provider.
MIDF Research highlighted that the e- commerce sector is l ikely to benef it from gove r nme nt i n i t i at ive s including the Digital Free Trade Zone ( DFTZ) and the National E- commerce Strategic Roadmap.
“The DFTZ will be launched this week in conjunction with Alibaba’s founder, Jack Ma’s visit to Malaysia,” it said.
MIDF Research noted that GDEX has increased its daily parcel sorting capacity from 78,000 parcels per day in financial year 2016 ( FY16) to 85,000 parcels per day (150,000 under stretched conditions) as of the first half of FY17 (1HFY17).
The research arm expected GDEX to be able to increase the group’s capacity to 100,000 parcels per day under normal conditions by end- FY17 and 130,000 per day in FY18.
MIDF Research highlighted that GDEX is currently in the design stage of a new international parcel sorting hub in Sungai Buloh with possible capacity addition of 70,000 parcels per day.
“Meanwhile, the company is also keen on expanding its operations in Sabah and Sarawak,” the research arm said.
“It aims to operate a new sorting hub in the latter to receive goods directly from overseas suppl iers instead of transiting from Peninsula Malaysia which reduces the cost of e- commerce goods in Sabah and Sarawak.”
MIDF Research pointed out that having invested RM10 million in convertible bonds ( convertible to 40 per cent equity) in PT SAP Express in Indonesia, GDEX has been transferring its technical knowhow and experience to enhance the company.
The research arm noted that PT SAP Express is currently profitable and experiencing high volume growth, close to 100 per cent year on year ( y- o-y).