KUALA LUMPUR: Air travel is still not safe despite interstate borders have reopened, and the best way to keep social distancing from passengers at airports is to travel by car.
TA Securities Holdings Bhd said the new daily Covid-19 cases in Malaysia are stubbornly high at more than 1,000 these days, however, the government has relaxed the movement controls in certain states, suggesting that the Covid-19 trend in Malaysia would remain elevated in the near term before citizens receiving vaccinations against the Covid-19, it said in a research report recently.
The research firm also expect the arrival of 1.0 million Pfizer vaccines in the first quarter of 2021, followed by 1.7 million, 5.8 million and 4.3 million doses in subsequent quarters.
"The deal with Pfizer is likely to cover 6.4 million Malaysians, or 20 per cent of the population, with another 10 per cent to be covered under the Covax facility," it said quoting the government data.
TA Securities said the government had also entered into an agreement with China on cooperation in safe and efficacious vaccine development.
The first clinical trial will begin this month using an experimental vaccine developed by the Beijing-based Institute of Medical Biology Chinese Academy of Medical Sciences, which will recruit 3,000 participants in eight locations around the country.
"China's Covid-19 vaccine and Russia's Sputnik V vaccines also claim to have efficacy of more than 90 per cent."
Recently, the Malaysian Aviation Commission (MAVCOM) had revised passenger traffic with a contraction of between 72.8 per cent and 75.7 per cent to 26.6 million and 29.7 million passengers this year.
For 2021, the commission estimates the passenger traffic will rebound strongly by between 94.2 per cent and 100.3 per cent year-on-year (YoY) to 51.7 million to 53.3 million passengers next year.
"This is a stark contract with our estimates of 33.3 million passengers where we conservatively assume the passenger growth to return from the second half of 2021 onwards in conjunction with full borders reopening," said TA Securities.
The research firm forecast Malaysia Airports Holdings Bhd (MAHB) financial year ending December 21, 2021 (FY21) loss projection of RM230.3 million higher that consensus estimate of RM73.4 million loss.
"However, we believe our earnings projections and traffic assumptions are justifiable given that first half of 2021 outlook is expected to be clouded by the pandemic," it said.
"We maintain MAHB's valuation at RM6.50 per share, based on a discount rate of 11.3 per cent, indicating the market has already factored in the recent positive development in Covid-19 vaccines while the sign of traffic recovery is still highly uncertain."
The decline in MAHB's passenger movements has accelerated to 96.4 per cent in November 2020 compared to October at 92.1 per cent since the reintroduction of conditional movement control order (CMCO).
The airport operator recorded 311,000 in total passenger movements last month, comprising 234,000 domestic and 78,000 international passenger movements.
On a cumulative basis, the contraction in 11 months of 2020 passenger movements expanded to 74.1 per cent to 24.6 million.
Meanwhile, MAHB's Istanbul Sabiha Gökçen International Airport (ISG) recorded a contraction of 47 per cent YoY in November 2020 to 1.5 million passenger movements, comprising 440,000 international and 1.1 millio domestic passenger traffic.
The YoY declines in both international (61 per cent) and domestic (38.9 per cent) segments were due to the reintroduction of partial curfews on November 20, as measures to curb the rise in Covid-19 cases across Turkey.
On a cumulative basis, 11-month of 2020 passenger movements dropped by 49.6 per cent to 16.6 million.