KUALA LUMPUR, June 30 ― Malaysia Airports Holdings Bhd's (MAHB) share price gained 1.03 per cent at the end of the morning session.

At lunch break, the counter rose seven sen, or 1.03 per cent, to RM6.90 from RM6.83 with 448,000 shares traded.

In a note today, Hong Leong Investment Bank sees further recovery in the second half of this year (2H 2023) and believes it is well-positioned to benefit from the pent-up travel demand.

"The gradual easing of international travel protocols and the relaxation of entry procedures globally have contributed to an increase in travel demand. This bodes well for MAHB to benefit from higher passenger movement.

"Higher passenger movement will directly drive MAHB’s passenger service charge income (which is levied on departing passengers) and aircraft landing charge income (which is charged to the airline), and which make up 53 per cent of group revenue.

The research house said following the reopening of Malaysia's international borders in the second quarter of 2022 (2Q 2022), both Malaysian-based and international airlines have gradually increased their flight frequencies.

MAHB has guided airlines seat capacity to reach a strong 80 per cent of 2019 levels by 2H 2023 based on current airlines planned scheduled growth.

In particular, the China sector is expected to recover to 62 per cent of pre-pandemic level by year-end versus the current 10 to 20 per cent in 1Q 2023.

Technically, MAHB is trading near its mid-term support range of between RM6.60 and RM6.80, with indicators showing an uptick bias. A successful breakout above the RM6.89 hurdle will spur the price above RM7.00. ― Bernama