PETALING JAYA: BIMB Research expects Perak Transit Bhd’s operations to remain relatively stable, supported by resilient demand for value-for-money, last-mile public transport services.In its most recent report, the research house says news flows have been rather benign over the quarter, with no indications of forced share disposals – an indication that all is well and gyrates positively with the bus operator.
“The market has yet to re-rate it, but as things stay quiet for longer, we think a silent re-rating should be underway,” it opined.
According to BIMB Research, Perak Transit has been cash-generative, operationally resilient, and on track to deliver steady, utility-like growth.
It added it was optimistic about the company’s catalysts, which include consistent foot traffic growth of 3% to 4% yearly and its ongoing expansions of existing facilities.
“Perak Transit also has been consistently winning extensions of concessions from regulators, affirming long-term earnings visibility, and the prospects of the new bus terminal in Kota Baru will bode well for the company,” it said.
It added that the group’s outlook for land transport is positive, as it is a fundamental growth narrative for the country.
“Additionally, the launch of new routes reinforces the attractiveness of land transport across all corners of the country.
“Perak Transit sits at the forefront of this growth story,” it said.
On the company’s earnings, the research firm said its fourth-quarter (4Q) results are expected on Feb 26, 2026 and has forecast its profit after tax and minority interest will be at RM19.9mil, an increase of 0.6% year-on-year.
This will bring its financial year 2025 (FY25) earnings to RM79.4mil.
It said the 4Q is usually the strongest due to year-end holidays and festive travel.
The research house reckons investors will be looking for the outcome of elevated trade receivables recorded in 3Q of FY25, which management attributed to a distressed customer currently on a repayment plan and whether the dividend payout of 40% will be maintained.
“The total distressed receivables is about RM30mil, and could wipe out 40% of our FY25 earnings.
We take comfort that repayment is ongoing, and we believe there will not be an impairment,” BIMB Research said.
With that, the research house said it will maintain a “buy” call on the company with a target price of RM0.68 derived via 10-year forward discounted cash flow valuation.It noted the stock was trading at less than four times a year forward earnings multiple and yielding 9%.