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MAHB share price falls over Turkish coup attempt

 | July 18, 2016

The failed Turkish coup has added to a long adverse list against air travel, says Maybank IB Research.

MAHBKUALA LUMPUR: Malaysia Airports Holdings Bhd’s (MAHB) share price dropped 33 sen to RM6.11 with 10,100 shares traded as at 10am today over the attempted military coup in Turkey.

Maybank IB Research, in a note, said the failed Turkish coup added to a long adverse list against air travel.

On the other hand, the Malaysian government is considering allowing only passengers to enter airport terminals to enhance security, it added.

“We keep our earnings forecasts and ‘HOLD’ call unchanged pending unfolding of both events (the failed coup and Malaysian government’s decision),” it said.

The attempted coup in Turkey has left at least 265 people dead while nearly 6,000 suspected military plotters, as well as judges, were detained by government forces.

MAHB owns and operates Istanbul’s Sabiha Gokcen International Airport.

Maybank IB said it had reduced MAHB’s target price to RM6.40 from RM6.44 as the risk profile had risen.

AllianceDBS Research has also maintained a ‘HOLD’ call on MAHB with the target price of RM6.20 from RM6.40.

“The failed coup on July 15 occurred shortly after a terror attack (at a gay nightclub in Orlando) in late June and a truck mayhem in Nice (on July 14) that claimed many civilian lives.

“As the perceived domestic instability rises, we expect slower growth in tourist arrivals and air travel demand,” it said in a note.

AllianceDBS Research said this posed risks to the targeted turnaround at MAHB’s Turkish operations, which had been dragging group profitability.

“While we expect near-term sentiment and earnings to be impacted, MAHB’s value is underpinned primarily by its dominant Malaysian operations,” it added.

 


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