Tasco Berhad - Within Expectations
Thu, 30-Oct-2025 09:33 am
by Steven Chong • Apex Research

Counter

TASCO (5140)

Target Price (RM)

0.51

Recommendation

Hold

·   2QFY26 CNP dipped (-23.9% YoY, +2.2% QoQ) to RM10.6m, bringing 6MFY26 CNP to RM21.0m (-14.5% YoY), accounting for 44%/45% of our/consensus full-year forecast. We deem the result to be within expectations as we expect earnings momentum to pick up in 2H, supported by seasonal demand ahead of the year-end festive period. Furthermore, easing tensions between the US and China could help lift global trade volumes.

·   No changes were made to our earnings forecasts, as the reported figures were within expectations. We also introduce our FY28F estimates.

·   Maintain our HOLD call on Tasco with an unchanged TP of RM0.51 by pegging PE multiple of 8.5x reflecting -0.5SD to the 3-year mean.

 

Results within expectations. Tasco’s 6MFY26 CNP came in at RM21.0m, accounting for 44%/45% of our/consensus full-year forecast. We deem the result to be within expectations as we expect earnings momentum to pick up in 2H, supported by seasonal demand ahead of the year-end festive period. Furthermore, easing tensions between the US and China could help lift trade volumes in the coming quarters.

 

YoY. Tasco’s 2QFY26 CNP fell 23.9% YoY, in line with a 21.7% YoY decline in revenue, weighed down by both the IBS (Revenue -27.6% YoY; PBT -29.7% YoY) and the DBS segment (Revenue -16.4% YoY; PBT -24.9% YoY). The weakness in IBS revenue was dragged by softer freight demand in the AFF and OFF divisions. Meanwhile, the DBS segment was affected by the CL and CSC divisions with the former impacted by a production halt from a major solar panel customer and slower overall demand, while the latter was hit by the exit of several F&B clients. The trucking division also saw a decline driven by similar factors affecting the CL division.

 

QoQ. Revenue and CNP rose by 4.0% QoQ and 2.2% QoQ respectively, mainly led by the DBS segment. Revenue from the CL and trucking divisions which has climbed 6.9% QoQ and 22.7% QoQ, respectively, largely offset the slight dip in CSC (-2.7% QoQ). Notably, the CL division benefited from a recovery in demand and new customer wins.

 

Outlook. The recent preliminary US–China trade talks in Malaysia have helped ease bilateral tensions and partially restore confidence in the regional trade outlook. The renewed engagement between the world’s two largest economies marks a constructive step toward stabilising global supply chains. While a full trade resolution remains unlikely at this stage, we see potential for gradual de-escalation as both countries consider scaling back selected trade restrictions.

Earnings Revision. No changes were made to our earnings forecasts, as the reported figures were within expectations. We also introduce our FY28F estimates.

 

Valuation. We maintain our HOLD call on Tasco with an unchanged TP of RM0.51 based on a PE multiple of 8.5x reflecting -0.5SD to the 3-year mean.

 

Risks. Prolonged geopolitical uncertainties and inflationary pressures arising from Trump tariffs may continue to suppress global demand, posing downside risks to Tasco’s performance, particularly in its international freight and logistics operations.

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Opinions, estimates and projections in this report constitute the current judgment of the author. They do not necessarily reflect the opinion of Apex Securities Berhad and are subject to change without notice. Apex Securities Berhad has no obligation to update, modify or amend this report or to otherwise notify a reader thereof in the event that any matter stated herein, or any opinion, projection, forecast or estimate set forth herein, changes or subsequently becomes inaccurate.

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