Prolintas Infra Business Trust (PIBT), an Islamic business trust that has four major intra-urban toll highway assets in its portfolio, has been given a ‘Buy’ with a 52-week target price of RM1.13 in an initiation report at Maybank Investment Bank Bhd.

The report said that due to its business trust set-up, PIBT can give dividends out of distributable income (without being constrained by accounting profits), and that it planned to distribute RM70m (6.4sen/unit) for the financial year ended Dec 31, 2024 (FY24).

“We expect distribution to grow over time,” it said in the report dated Sept 8.

Listed on the Main Market of Bursa Malaysia Securities on March 25, 2024 at an issue price of 95 sen, PIBT provides investors the opportunity to invest in highway-related infrastructure assets.

PIBT has four urban toll highway assets: – AKLEH, GCE, LKSA, SILK – in its portfolio Ampang – Kuala Lumpur Elevated Highway (AKLEH), Guthrie Corridor Expressway (GCE), Lebuhraya Kemuning – Shah Alam (LKSA) and Sistem Lingkaran – Lebuhraya Kajang (SILK).

The four major intra-urban toll highway assets in its portfolio has a combined market share of 15.7% (by traffic volume) in the Klang Valley in 2021.

It noted that SILK was the largest contributor to total toll collection at 45% in FY23, followed by GCE (30%), LKSA (14%) and AKLEH (11%).

“The Trust Group offers an exposure to expanding traffic volume amid rising economic activities and urbanisation. At the same time, it also offers sustainable and regular distribution to unitholders,” the report added.

Having restructured its concession terms with the Government in October 2022, it said PIBT’s three toll highways will see higher toll rates in 2033 and 2043 while the other highway will not see any rate hike.

It noted that PIBT’s toll assets have an average remaining concession period of 31 years as at Sept 1, 2024.

“As such, there is long-term visibility on future toll revenues and cash flows, which translates into sustainable distribution for unitholders,” it said.

The counter closed at 91.5 sen yesterday (52-week high/low: RM1.00/81 sen), valuing the company at RM1.0 billion. –TMR