The recent deadly crane accident at Tanjung Bin has brought Malakoff Corporation Bhd into the spotlight, raising concerns about its stock stability and wider risks. But here's where it gets controversial—this incident might not just be an isolated event but could have lasting repercussions on the company’s regulatory standing, environmental, and social governance (ESG) reputation.
As reported by CGS International, Malakoff’s share price could face downward pressure in the wake of last Friday’s tragic crane collapse, which unfortunately resulted in two fatalities and injuries to three others. This event marks the second serious incident at the Tanjung Bin facility within just three months, signaling a worrying pattern that could attract closer regulatory inspection and scrutiny.
The research firm notes that additional uncertainties loom large, including how long repairs will take, what liabilities the company might face, and how these incidents could influence investor confidence and future project opportunities. In essence, ongoing incidents may cast a long shadow over Malakoff’s market performance, potentially leading to increased risk premiums—meaning investors might demand higher returns due to the perceived increased risks—until investigations conclude and clearer answers about the company’s future emerge.
Malakoff disclosed the incident on December 13, revealing that the collapse occurred during maintenance at the jetty of the Tanjung Bin complex. The tragedy marked the company's first fatal workplace accident since its IPO in 2015.
Following the news, the company’s shares fell by as much as two sen, approximately 2%, to 83.5 sen on Monday, which was contrary to the gains seen in the broader utilities sector and the overall market. It’s worth noting that Malakoff's stock has nearly wiped out all its gains for 2025, primarily due to disappointing financial results.
Despite this setback, most analysts, including CGS International, remain optimistic about Malakoff’s prospects. The consensus among six ‘buy,’ two ‘hold,’ and three ‘sell’ ratings, with an average target price of 99 sen—suggesting a potential upside of around 19% over the next year—indicates continued confidence, at least in the company’s underlying assets.
CGS International emphasizes that it is still too early to determine the full impact on future project tenders or contracts, as the incident introduces new headline risks and ESG factors that could influence public perception and regulatory decisions.
Currently, the firm maintains a 'buy' or 'add' rating on Malakoff, noting that the market seems to be valuing its existing assets at a significant discount—approximately 95 sen per share—while assigning little to no value to the company’s secured growth pipeline or the potential upside from a new gas-fired power plant.
This situation underscores an important point for investors: such incidents often trigger a complex assessment of safety, regulatory, and environmental risks, which can considerably affect a company's valuation. Do you agree that safety incidents should lead to steep stock declines, or should fundamental asset value still take precedence? Share your thoughts and join the conversation.
