KUALA LUMPUR: A financial weekly's report on the privatisation of Malaysia Airports Holdings Bhd (MAHB) is "not convincing", according to a research firm.
The Edge Weekly last week cited unidentified sources that MAHB could be privatised by its major shareholders before a stake sale to private equity firm Global Infrastructure Partners (GIP).
Specifically, both sovereign wealth fund
Khazanah Nasional Bhd and Employees Provident Fund (EPF) which owns 33.2 per cent and 7.0 per cent stake in MAHB respectively, reportedly would be instrumental in the privatisation.
Thereafter, a 30 per cent stake in MAHB will be sold to GIP, an infrastructure investment fund involved in equity and selected debt investments.
This could be probably due to MAHB's shares not liquid enough for GIP to acquire a substantial stake in MAHB over a reasonable time frame.
"We do not find the story convincing given the lack of details, particularly the absence of an indicative offer price," Kenanga Research said today.
"Nevertheless, the plan to have an external party to manage MAHB is not new," the firm added.
Back in August 2001, the Finance Ministry signed a memorandum of understanding with Schiphol to allow the latter to acquire a strategic investment in MAHB. However, the deal was aborted.
Kenanga Research said for illustration purposes, assuming the MAHB privatisation is at RM10 per share, the price earnings ratio (PER) valuation works out to 25 times and 18 times its finamcial tear 2025 (FY25) earnings per share (EPS) and FY25 consensus EPS respectively.
This implies a discount of 26-47 per cent compared to closest listed peer Airport of Thailand which trades at 34x FY25 consensus EPS.
"We believe the PER valuation discount to closest listed peer i.e. Airport of Thailand makes sense considering that
Thailand's tourism revenue is three times larger than Malaysia's."
Based on FY25F PER of 24x, MAHB trades at discount to pre-Covid three-year average historical one-year forward PER of 35x.
Kenanga Research maintained its earnings forecasts, target price of
RM9.00 and "Market Performer" call on MAHB.