KUALA LUMPUR: The government’s plan to build a railway line linking the sea ports of Penang and Songkhla in Thailand will help speed up economic activities in the northern region, Maybank Investment Bank Bhd said.
“We are positive on this proposal as it will help to speed up economic activities in the northern peninsula. A major highway or railway line would also help to lift the movements of people (besides cargo) and tourism activities,” the research house said in a report.
The proposal was mooted during Second Finance Minister Datuk Seri Johari Abdul Ghani’s visit to Thailand in mid-September.
Maybank IB said if the proposal becomes a reality, both countries are expected to see good flow of goods and containers between Songkhla Port and Penang Port, bypassing the busy Straits of Malacca, and it could also replace the proposed Kra Canal at southern Thailand.
Maybank IB said the proposal to better connect Penang Port with Songkhla Port could benefit Bukit Kayu Hitam.
It said higher economic activities at Bukit Kayu Hitam should, in turn, be long-term positive for Atlan Holdings Bhd as its The ZON duty free outlet sits on a large 772 acres of land which has been earmarked for a major development.
“For Atlan, it would benefit from higher spendings at its duty free outlet at Bukit Kayu Hitam, sandwiched between the Thai and Malaysian Customs and Immigration checkpoints; it could also help kick-start major development on its large tract of land where its duty free outlet sits.
“Besides Bukit Kayu Hitam (in Kedah), Atlan also has duty free outlets at the other border towns with Thailand - at Padang Besar (Perlis), Pengkalan Hulu (Perak) and Rantau Panjang (Kelantan),” it said.
Maybank IB has retained its “buy” call on Atlan with an unchanged target price of RM6.