Malaysia Airports Holdings Bhd
Market Perform. Target price: RM9.00
PSC tariff revision, transfer PSC introduced. The Malaysian Aviation Commission (Mavcom) on Tuesday announced the revisions to the Passenger Service Charges (PSC) for the First Regulatory Period (RP1), with effect from June 1, 2024 to Dec 31, 2026. Specifically, the PSC rates are for international travel i.e. Asean and beyond Asean. PSC have been unified into a single international departure of RM73 per pax for KL International Airport (KLIA) Terminal 1, and RM50 per pax for KLIA Terminal 2 and other airports.
Mavcom is also introducing a transfer PSC for passengers transiting through a Malaysian airport. The rate for domestic travel through all airports is RM7, while the rates are RM42 for international travel through KLIA Terminal 1 and RM29 for international travel through KLIA Terminal 2 and other airports. It has allowed the other airports not operated by subsidiaries of Malaysia Airports Holdings Bhd (Malaysia Airports (Sepang) Sdn Bhd and Malaysia Airports Sdn Bhd), namely the Senai International Airport (JHB), Kerteh Airport (KTE), and Tanjung Manis Airport (TGC), to propose tariffs for RP1 to Mavcom.
This latest PSC tariff rate is status quo for KLIA Terminal 1. For KLIA Terminal 1, there was an increase in PSC for Asean by 109% from RM35 to RM73/pax. However, in Terminal 2, PSC rate for Asean is higher by 43% from RM35 to RM50 per pax. On the contrary, PSC rate for beyond Asean (non-Asean) was lowered by 32% from RM73 to RM50.
We raise our FY24-25F net profit forecasts by 12% each, lift our TP by 13% to RM9.00 (from RM8.00) but maintain our MARKET PERFORM call as we believe the earnings upside has been fully priced in.