RHB is moved by FM Global Logistics promising outlook
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00:00 On this first Wednesday of October, we are looking at FM Global Logistics Holdings, where
00:06 RHB is keeping its buy call but adjusted its target price from 79 cent to 68 cent, saying
00:11 that it is a slow start but it has a promising outlook.
00:15 Overall, vessel capacity or supply continues to trend higher than demand amidst the slow
00:19 cargo market and incoming new building deliveries.
00:22 The overcapacity of ocean vessels should continue to keep a lid on freight rates from rising.
00:27 RHB actually expects a soft first half of FY24, in line with its cautious view on the
00:32 country's first half 2023 trade performance.
00:36 RHB expects the current market dynamics to continue to weigh down on FM's international
00:41 businesses.
00:42 But nevertheless, its domestic businesses such as third-party logistics, warehousing
00:46 and supporting services should continue to bolster the group's earnings.
00:51 As revision that it has put forward, RHB actually lowers its FY24 earnings by 4.6% based on
00:57 the aforementioned factors.
01:00 According to Bloomberg, only RHB covers it.
01:02 So based on its lower TP of 68 cent, this implies a possible upside of 19% from its
01:07 current levels.
01:08 It closed yesterday at 57 cent.
01:11 [Music]