8 June 2018
Amanah Investment Bank Bhd believes Malaysia Airports Holdings Bhd (MAHB) venture into retail business via Mitsui Outlet Park could enhance its long-term strategic plan of becoming an airport city.
The park will bode well with the overall objective of MAHB’s Runway to Success initiative which is to build Kuala Lumpur International Airport (KLIA) as a tourist destination.
“Mix development around the land area of Malaysia Airports will complement its extended function of becoming an airport city.
“Subsequently, we believe the company is moving in the right direction to provide more functions towards travellers as well as locals who are seeking for convenience.
“All in, our optimism on MAHB’s prospect still remains,” MIDF said in its note following a recent visit to Mitsui Outlet Park.
MIDF said the park’s overall occupancy rate stood at 97 per cent and was expected to ease to 95 per cent following the completion of overall development.
Its tenant mix comprised luxury, international and local brands in fashion, cosmetics, sports and accessories. More offerings will include for entertainment and amusement.
“The management mentioned that average footfalls on weekdays/day stood at seven thousands, which will double on weekends and major public holidays.
“As far as promotional campaign is concerned, shops on average will offer 50 per cent discount from original price on weekdays, and could go up to 90 per cent on major public holidays,” it said.
MIDF said given Mitsui’s long experience of operating outlet malls, the management remains effective in providing modern facilities to visitors as well as tenants.
Its primary facilities are anchored by its objective to draw the passenger traffic flow in airports (Main Terminal and klia2) to Mitsui Outlet Park KLIA.
This included free shuttle busses every twenty minutes, flight information display systems around the mall, flight check-in center and free baggage storage services.
“We opine these offerings add convenience for airport shopping visitors. We opine that Mitsui Outlet Park’s location is its unique competitive advantage in comparison to other outlet malls in Malaysia,” it said.
MIDF maintained its “buy” call on MAHB with an unchanged target price of RM9.88.
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