It is barely a year since freight forwarding and aerospace logistics provider AGX Group Bhd was listed. The 3PL service provider where its services comprise sea and air freight forwarding, aerospace logistics, warehousing and other 3PL, road freight transportation services.

Investors are probably positive of the outlook of the logistics service industry amid rising geopolitical tensions as the company intends to adopt a cost-plus pricing strategy.

In terms of yield, AGX has adopted a dividend policy of at least 30% of its annual profits attributable to shareholders. It made a net profit of RM3 million on the back of revenue of RM47.3 million in its third quarter ended Sept 30, 2023. For the nine months just ended, the company reported a net profit of RM9.16 million on the back of RM138.16 million revenue.

Prior to its market debut, the company saw an oversubscription of 15.43 times for its IPO and successfully raised RM33.78 million in proceeds at 35 sen per share. Its immediate expansion plans include setting up a new warehouse and office in Port of Tanjung Pelepas (PTP), Johor to complement its operations in Singapore.

In addition, the forex differentials between the Singapore dollar and the Malaysian ringgit will help contribute to the company’s profitability, as it sells in Singapore dollars and captures its costs in ringgit.

The company also plans to set up an office in Penang to improve its coverage in the northern region of Malaysia, as well as one in Busan, South Korea to support its sea freight business division.

Meanwhile, AGX expressed its interest in expanding its presence to Indonesia, Thailand and Vietnam, aiming to become one of the largest industry players in the Southeast Asian region.

The bulk of its business comes from the Philippines, which contributed 50.5% of its total revenue or RM69.79 million, followed by Malaysia (RM31.24 million), Singapore (RM15.8 million), Korea (RM13.37 million and Myanmar (RM7.95 million).

The company is also focusing on the aerospace segment, which accounted for 37% of its revenue base. Its aerospace logistics segment is the largest revenue contributor, with RM51.67 million, followed by sea freight forwarding at RM49.78 million and air freight forwarding at RM23.59 million.

Other segments are warehousing and other third-party logistics services (RM8.12 million) and road freight transportation (RM5 million).