KUALA LUMPUR: CIMB Equities Research has lowered Westports Holdings target price from RM4.58 to RM4 as its volume growth may slow down in the immediate term. It said on Thursday that as the planned April 1, 2017 container shipping realignments approaches, it believes that Westports may deliver slower volume growth in FY17-18 than previously thought. We maintain Hold as Westports remains a solid, profitable company,” CIMB Research said.On April 1, 2017, the OCEAN and THE alliances will finally come into effect. This caps a tumultuous period in container shipping which started from late-2015, when CMA CGM began negotiations to acquire APL, and when COSCO was asked by the Chinese government to absorb CSCL. Hence, by mid-2020s, there could be a significant supply of port capacity in ASEAN that could intensify price competition, notwithstanding high capex costs at Pulau Carey,” said CIMB Research.
Source: The Star January 12, 2017 00:40 UTC