SCS [BUY +34.5%] - H2 2023 volume turnaround led by new client acquisition

- We maintain our BUY rating for SCS despite cutting our target price (TP) by 8% due to weaker-than-expected international trade activity.

- For 2023-2025, we cut our aggregate NPAT-MI forecast by 6% because of an 8% reduction in our cargo throughput projection, which is partly offset by our lower COGS projections.

- SCS’s international cargo volume dropped 45% YoY in Q1 2023 due to weak orders for Vietnamese exports as well as Q1 2022’s high base.