GDEX Berhad - Supercharged by Logistics Recovery and GD Xchange
Tue, 03-Feb-2026 09:05 am
by Daryl Hon • Apex Research

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GDEX (0078)

Target Price (RM)

0.20

Recommendation

Buy

  • GDEX Berhad is an integrated logistics and express delivery provider focused on B2B logistics in Malaysia, with a growing regional presence and an expanding technology business under the GD Xchange roadmap.

  • Core earnings are projected to grow to RM19.4m/RM36.8m/RM46.5m in FY26-28F at a CAGR of c.55%, primarily driven by (i) recovery in its domestic express delivery and logistics business (ii) cost cutting measures in NETCO, (iii) increased revenue and profit from GD Xchange segments, (iv) further internal cost optimisation measures. 

  • We initiate coverage on GDEX with a BUY recommendation and a TP of RM0.20, based on 30x FY27 EPS of 0.7 sen, implying a PEG ratio of 0.55x.

 

Key Investment Highlights

GD Xchange: The Super Platform for Technology Services. GD Xchange represents a strategic transformation from a traditional express delivery operator into a tech-driven logistics ecosystem with global reach, positioning itself to become a WeChat-like super platform for technology services. It offers end-to-end implementation, installation, and after-sales support across cybersecurity, integrated POS systems, cloud subscriptions, workspace solutions, and e-commerce platforms for companies. Leveraging its one-stop solution capability and established B2B customer base from its express delivery business, GDEX is well placed to accelerate cross-selling, offer bundled solutions at more competitive rates, and build a recurring, services-led revenue base. Some of GDEX’s partnerships include AWS, Microsoft, Lark (Bytedance), Blackberry, Okta and Shopify. This ability to provide bundled discounts and preferential pricing enhances customer stickiness while lowering acquisition costs. Its IT segment is expected to contribute RM9.5m/RM16.3m/RM24.2m to net profit for FY26F/FY27F/FY28F.

 

Dissipating Competitive Pressure in the Domestic Logistics Sector. Competitiveness in the logistics sector is easing following prolonged price-led competition, evidenced by the recent exit of Flash Express Malaysia. With domestic logistics demand still growing and warehouse utilisation at only c.50 to 60%, GDEX has ample capacity to scale volumes efficiently. We forecast revenue growth of c.15.9%/8.7%/5.0% in FY26F/FY27F/FY28F, respectively, for its express delivery and logistics segment, translating into a two-year CAGR of c.6.8% and supporting meaningful operating leverage.

 

Immediate cost savings from rationalisation of operations in NETCO. GDEX is expected to realise immediate cost savings of c.RM5m from the rationalisation of operations at its Vietnam subsidiary, NETCO, following the expiry of the five-year post-acquisition restriction that previously limited operational influence. These savings are driven mainly by lower rental expenses and reduced senior management headcount, with further efficiencies from automation, route optimisation and transport mix improvements. We expect total cost savings to reach c.RM8.4m in 2026. NETCO is projected to return to profitability in 2026, supported by a c.25% revenue increase from RM30m in FY25F to RM38m in FY26F, representing a c.RM12.7m swing from loss to profit before minority interest.

 

Earnings Outlook. We project GDEX’s earnings to grow to RM19.4m/RM36.8m/RM46.5m in FY26-28F at a CAGR of c.55% due to (i) the recovery in its domestic express delivery business, (ii) NETCO’s turnaround and (iii) contributions from GD Xchange.

 

Valuation and Recommendation. We initiate coverage on GDEX with a BUY recommendation and a TP of RM0.20, based on 30x FY27F EPS of 0.7 sen. We view this valuation as fair, as it is broadly in line with the global peer average P/E of 29.1x, reflecting GDEX’s comparable growth profile. At this multiple, the implied PEG ratio of 0.55x suggests that the stock is materially undervalued relative to its strong expected profit CAGR in our view.

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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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