TASCO - Boom in 3rd Party Logistics (OSK)

TASCO has just opened a new 197,000-sq ft single storey warehouse at its Bangi Logistics Centre 2. The warehouse, built on a 35,289 sq m or about 8.7-acre site, will cater to the company’s Tier 1 client, Sony, which has just inked a 5-year contract with TASCO. The company sees healthy growth for its warehousing and 3rd party logistics (3PL) segment going forward. We continue to like the robust growth in its forwarding and contract logistics division. TASCO will open another new warehouse – of 160,000 sq ft – in Shah Alam by the end of November. We reiterate our BUY call with an unchanged FV of RM1.93, based on 7x FY11 EPS.