Diversified Business Model To Keep Dialog Resilient, Says HLIB

KUALA LUMPUR, July 14 (Bernama) -- Dialog Group Bhd is poised to remain highly resilient in a volatile environment, particularly amid the West Asia conflict, thanks to its diversified business model, said Hong Leong Investment Bank Bhd (HLIB).

The investment bank said Dialog’s midstream tank terminal segment provides stable, recurring income, while its upstream operations benefit from elevated Brent crude prices.

Notably, it said New Zealand is exploring fuel storage options in Malaysia and Singapore, as geopolitical conflicts expose the risks of limited domestic storage capacity and an overreliance on single supply routes.

“This development is expected to further elevate Pengerang’s strategic importance as a premier regional storage and logistics hub.

“Dialog emerges as a primary beneficiary, given its substantial tank terminal footprint and approximately 267.09 hectares of available buffer land dedicated to future expansion,” it said in a note.

HLIB said it is maintaining a “buy” call on Dialog with an unchanged target price of RM2.52, stating that “the eventual award of long-term tank terminal contracts for Pengerang Deepwater Terminals Phase 3 should serve as a key re-rating catalyst for the stock.”

“We like Dialog for its robust recurring income streams and its unique positioning to capitalise on Pengerang’s long-term expansion through ongoing tank terminal developments,” it added.

At 10.25 am, the counter was three sen higher at RM1.92 with 1.71 million shares transacted.

-- BERNAMA