Westports poised to benefit from trade diversion and expansion plans: Kenanga

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WESTPORTS’ nine months financial year 2025 (9MFY25) core net profit met expectations at 76% of both Kenanga’s forecast and the consensus estimate. No dividend was declared as it typically announced half-yearly.

Year-on-year (YoY), its 9MFY25 revenue rose 24% despite a slight increase in the container throughput volume (+4%) driven by higher average revenue per TEU (+19%) from higher value-added services (VAS) ratio of 25% and 1st phase port tariff adjustment of 15%, which was implemented with effect from 15 July 2025. 

Other key drivers in 9MFY25 include: 

(i) higher storage income of metal commodities following more stringent regulatory inspections to curb illegal e-waste entry.

(ii) higher restow services from Evergreen shipping line due to disruption in vessels trade routes planning in 3Q as well as reshuffling of boxes for Gemini Cooperation in the 1HFY25.

(iii) higher rental revenue from higher warehouse sublease renewal rates and MFRS 16 adjustment.

(iv) front-loading on Trump tariff.

Its transhipment volume grew 8% underpinned by restow services from Evergreen shipping line in quarter three (3Q) and Gemini Cooperation in the first half of financial year 2025 (1HFY25).

Also, note Ocean Alliance which boosted the volume for Asia-Europe routes (+24%) and other routes despite lower intra-Asia trade due to higher base in 9MFY24, and Asia-America routes (+17%) improved with some front-loading to the US. 

This offset the flat growth in its gateway container volume after growing YoY for 10 consecutive quarters which was partially affected by the stricter inspections of metals import by the authorities to curb illegal e-waste entry.

On the other hand, its conventional cargo volume increased to 9.21 mil metric tonnes (+2%) on higher volume of break bulk throughput (project cargoes and mixed steel) and dry bulk throughput (soybean, maize, clinker/slag, and fertiliser) volume with notable improvement in 3QFY5 in term of revenue on 1st phase port tariff adjustment of 15%.

Its core net profit grew 14% with a slightly lower effective tax rate at 23.0% vs. 23.2% in 9MFY24.

Kenanga likes WPRTS for its resilient earnings underpinned by long-term contracts with key clients such as Ocean Alliance.

Also, it has long-term growth prospects driven by the Westports 2 expansion project.

WPRTS also enjoy price competitiveness, lower transshipment tariffs vs peers such as Port of Tanjung Pelepas and Port of Singapore. 

“Maintain OUTPERFORM call. We believe that WPRTS should be able to weather the challenging global trade outlook as key beneficiary of trade diversion, while effectively managing its yards congestion issues by the significant hike in containers storage charge that can withstand vessels bunching from Middle East crisis,” said Kenanga. —Nov 5, 2025

Main image: New Straits Times

 

The post Westports poised to benefit from trade diversion and expansion plans: Kenanga first appeared on Focus Malaysia.

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