MISC profit to gain steam from tanker boom

By the Editorial Team · Wednesday, September 16, 2026

MISC Bhd is expected to see improved earnings driven by a robust tanker market fueled by supply disruptions and geopolitical tensions that have pushed shipping rates to record highs. This strong market environment positions MISC as a key beneficiary, with analysts maintaining a “buy” rating and a target stock price of RM9.50 despite recent share price declines.

MISC Bhd’s earnings outlook appears poised to strengthen amid a continuing boom in the tanker market, despite a recent pullback in the company’s share price. According to a recent analysis by UOB Kay Hian Research, while MISC’s shares have declined around 8% following a period of outperformance in the first half of 2026, the tanker market dynamics supporting its business remain robust.

Earlier this year, UOB Kay Hian had projected that MISC’s share price might underperform in the second half of 2026 relative to the first half, partly due to uncertainty surrounding the company’s consideration of a potential privatisation of Yinson Holdings Bhd. Concerns also stemmed from MISC’s relatively high net debt ratio, at three times its EBITDA, which could lead to volatile financial outcomes. The research house had thus advised caution for risk-averse investors.

However, the tankers market has since strengthened further, driven largely by supply-side disruptions rather than demand growth. These disruptions include vessel limitations, bottlenecks at key maritime chokepoints, and sanctions, all of which have increased shipping inefficiencies and extended voyage distances. This has led to a surge in tonne-miles shipped, despite softer overall demand. The current tanker cycle may even exceed the market conditions seen during the 2004 to 2008 supercycle, a period marked by rapid demand growth fueled by China’s economic expansion after joining the World Trade Organization.

Compounding the supply challenges, geopolitical tensions in the Middle East—specifically renewed hostilities between the United States and Iran—and disruptions around critical sea routes like the Bab el-Mandeb Strait have restricted oil flows and intensified tanker rates. The effective closure of the Strait of Hormuz amid the ongoing West Asia conflict has further contributed to record high spot rates. For the week ending September 2, 2026, average daily spot rates for very large crude carriers (VLCCs) reached approximately US$376,871, with some Gulf-to-China routes reportedly exceeding US$800,000.

As the only local publicly traded company with significant exposure to the tanker market, MISC is viewed by UOB Kay Hian as a key beneficiary of these market conditions. The company’s petroleum division recorded its strongest quarterly profit to date in the second quarter of 2026, posting US$232 million in earnings—nearly matching the US$236 million profit of subsidiary AET in 2023. Even after excluding gains from vessel disposals and accounting adjustments totaling US$57 million, the petroleum segment still generated US$175 million in profit, up from US$129 million in the previous quarter.

UOB Kay Hian suggests that if MISC maintains its current fleet management strategy, it could deliver positive earnings surprises in the second half of the year. Reflecting these developments, the research house has maintained a “buy” call on MISC’s stock, with a target price of RM9.50.

This article was reported by synthesizing coverage from multiple independent news outlets to present a balanced, unbiased account. Read about our editorial standards. Spotted an error? Let us know.