MAHB’s January passengers grow according to forecasts thanks to festive travel

Following MAHB’s passenger traffic snapshot in January 2018, total MAHB System (inclusive of ISG) recorded 10.8 million passengers which represent a 6.5 per cent growth over the same corresponding period last year.

KUCHING: Malaysia Airports Holdings Bhd’s (MAHB) January 2018 passengers growth, including that of Istanbul’s Sabiha Gocken International Airport (ISG), has come in line with analysts’ forecasts thanks to seasonality factors.

Following MAHB’s passenger traffic snapshot in January 2018, total MAHB System (inclusive of ISG) recorded 10.8 million passengers which represent a 6.5 per cent growth over the same corresponding period last year.

The research arm of Kenanga Investment Bank Bhd (Kenanga Research) deemed this in line with its total MAHB growth forecast of 8.5 per cent due to seasonality factors, namely Chinese New Year in FY17 was on January 28 while Chinese New Year in FY18 will be held on February 16.

MAHB noted that on the local front, airports in Malaysia registered 8.1 million passengers in January 2018, a 1.5 per cent year on year (y-o-y) growth over January 2017.

The research arm of MIDF Amanah Investment Bank Bhd (MIDF Research) saw that the slowdown in growth was due to a high base effect as the same period last year, passenger traffic grew strongly by 14.98 per cent y-o-y to 7.9 million passengers.

“Despite this, we believe the January 2018 growth as healthy considering that January is a weak month for air travel (excluding festive seasons) and the fact that Chinese New Year fell in January in 2017,” MIDF Research said.

“While we note that the increase in passenger traffic is commendable, the domestic fronts took a hit in January, contracting by 6.4 per cent y-o-y to 3.6 million passengers.

“This was due to the shift of this year’s Chinese New Year holiday to February from January last year.”

Despite the drop, MIDF Research was encouraged to see that the international traffic surged nine per cent y-o-y which more than offset the decline.

Moving forward, the research arm expected the momentum to continue in subsequent month fuelled by the Chinese New Year holiday season in February.

MIDF Research thus expected the growth of passengers’ traffic to remain in positive territory, driven by higher international passengers.

“The January 2018 numbers will set positive tone on the demand for air travel for the entire year supported by visa relaxation programme which will attract tourists from China, India and South East Asia sectors.”s

Considering that travel demand will maintain its upbeat momentum, MIDF Research continued to like MAHB as a proxy to Malaysia’s resilient inbound/outbound travel industry being the largest airport operator in Malaysia.

“We think that MAHB will be able to see the annual passenger traffic number to surpass the psychological 100 million at the latest within two years,” the research arm said.

For FY18, Kenanga Research targeted a softer Malaysian passenger growth of eight per cent, versus 10 per cent in FY17, due to lower seat capacities by key airlines Malindo and Malaysia Airlines Bhd (MAB) and weaker currency advantage from the stronger ringgit.

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