|
|
|
|
|
|
|
|
|
|
|
|
|
|
Share
Price:
|
MYR5.20
|
|
Target
Price:
|
MYR6.50
|
|
Recommendation:
|
Buy
|
|
|
|
|
|
|
|
|
Still a
commendable quarter
|
|
2QFY8/16 results were sequentially weaker but still solid,
being Top Glove’s historically second most profitable quarter. For
3QFY8/16, we think earnings could be flattish QoQ as sales volume
growth could compensate for the stronger MYR/USD and higher latex cost.
We maintain our earnings forecasts and BUY call. However, given the
volatility in external factors, we lower our target 2017 PER to 19x
(+1SD to mean PER, from 25x) to derive our new TP of MYR6.50 (-22%).
|
|
|
|
|
|
|
FYE Aug (MYR m)
|
FY14A
|
FY15A
|
FY16E
|
FY17E
|
|
Revenue
|
2,275.4
|
2,510.5
|
2,972.0
|
3,115.9
|
|
EBITDA
|
298.5
|
454.3
|
624.4
|
636.9
|
|
Core net profit
|
180.5
|
279.8
|
400.9
|
410.6
|
|
Core EPS (sen)
|
14.6
|
22.6
|
32.3
|
33.1
|
|
Core EPS growth (%)
|
(8.2)
|
55.0
|
43.3
|
2.4
|
|
Net DPS (sen)
|
8.0
|
11.5
|
16.2
|
16.6
|
|
Core P/E (x)
|
35.7
|
23.1
|
16.1
|
15.7
|
|
P/BV (x)
|
4.6
|
4.0
|
3.6
|
3.2
|
|
Net dividend yield (%)
|
1.5
|
2.2
|
3.1
|
3.2
|
|
ROAE (%)
|
13.3
|
18.6
|
23.5
|
21.5
|
|
ROAA (%)
|
9.8
|
12.1
|
14.2
|
13.4
|
|
EV/EBITDA (x)
|
9.4
|
10.1
|
9.9
|
9.5
|
|
Net debt/equity (%)
|
net cash
|
net cash
|
net cash
|
net cash
|
|
|
|
|
|
|
|
|
|
NEWS
|
|
|
Outside Malaysia:
U.S: Fed scales back rate-rise forecasts as global outlook
weakens. Federal Reserve officials held off from raising borrowing costs
and scaled back forecasts for how high interest rates will rise this
year, citing the potential impact from weaker global growth and
financial-market turmoil on the U.S. economy. The Federal Open Market
Committee kept the target range for the benchmark federal funds rate at
0.25% to 0.5%, the central bank said in a statement following a two- day
meeting in Washington. The median of policy makers’ updated quarterly
projections saw the rate at 0.875% at the end of 2016, implying two
quarter-point increases this year, down from four forecast in December.
(Source: Bloomberg)
U.S: Core consumer prices increase more than forecast again
in February for a second month, adding to signs inflation is moving
closer to the Federal Reserve’s target. The overall cost of living fell
amid cheaper fuel. The so-called core measure, which strips out volatile
food and fuel, rose 0.3% from a month earlier, the same as in January,
figures from the Labor Department showed. The last time there were
back-to-back gains of 0.3% was in early 2001. The overall consumer-price
index declined 0.2%. (Source: Bloomberg)
U.S: New-home construction rose more than forecast in
February, led by the strongest single-family building in more than eight
years, signaling continued confidence in demand for residential
real-estate. Housing starts in February climbed 5.2% to a 1.18million
annualized rate from a 1.12 million pace the prior month, a Commerce
Department report showed. Permits, a proxy for future construction, fell,
suggesting any additional gains in coming months will be limited.
(Source: Bloomberg)
U.S: Factory production rose in February for a second
month, boosted by demand for business equipment and indicating U.S.
manufacturing may be starting to stabilize. The 0.2% increase in output
followed a 0.5% gain in January, data from the Federal Reserve showed. It
marked the first back-to-back advance since March -April 2015. Total
industrial production dropped 0.5% as utility output plunged by the most
since March 2007. (Source: Bloomberg)
U.K: Cuts corporation tax rate again in a boon to Britain
plc. Chancellor of the Exchequer George Osborne’s decision to cut corporation
tax to 17% by 2020 will bring the U.K. rate to the second lowest among
developed countries. Only Ireland has a lower corporation tax rate --
12.5% -- among the 34 members of the Organization for Economic
Cooperation and Development. (Source: Bloomberg)
|
|
|
|
|
|
|
Other News:
Chin Hin: Buys land in Perak to build factory. Chin Hin
Group has entered into a sale and purchase agreement with CLH Realty Sdn
Bhd to acquire 26 parcels of land in Mukim Bidor, Perak, for a total of
MYR7m. Newly listed integrated building materials specialist said the
acquisition of the land parcels, which total 18.55 acres, will be
financed with internally generated funds. The land acquisition marks the
first step towards the construction of a factory, which is scheduled to
be completed within nine months and to begin operations in early 2017.
(Source: The Sun Daily)
Sapura: Selling its 49% stake in education arm.
Diversified group Sapura Resources (Sapura) is selling its entire 49%
stake in APIIT Education Group to ILMU Education Group Sdn Bhd for MYR246.98m,
a deal that could pave the way for a possible listing of the latter.
Ekuiti Nasional (Ekuinas), via its education arm ILMU, holds a 51% stake
in APIIT Education Group, which it acquired from Sapura in 2010 for
MYR102m. Sapura has entered into a conditional share sale agreement with
ILMU to dispose of its entire stake in APIIT Sdn Bhd, Asia Pacific
Univesity Sdn Bhd (APU) and Asia Pacific Institute of Information
Technology Lanka (PVT) Ltd (APIIT Lanka). (Source: The Sun Daily)
Muhibbah: Seeking construction opportunities in Myanmar,
Indonesia. Muhibbah Engineering is looking to expand its construction
business into Myanmar and Indonesia following its successful experience
in Cambodia. Muhibbah owns a 21% effective stake in Cambodia Airports,
which manages all three international airports in the country. The group
is prepared to venture together with Vinci in other airport projects
provided they are of the right size. (Source: The Edge Financial Daily)
Felda Global Ventures: Zhong Ling buy will boost downstream
presence. Felda Global Ventures (FGV) is confident that its latest
venture, the planned acquisition of a 55% stake in Zhong Ling Nutril0Oil
Holdings Ltd, valued at MYR976.25m, will boost its presence in
high-margin downstream activities. The intended investment had cleared
all necessary due diligence in accordance with FGV’s investment and
governance policies. The financials and tax due diligence that FGV has
performed covers Zhong Ling’s financials. (Source: The Edge Financial
Daily)
Scomi Engineering: Committed to completing KL Monorail
expansion project. Scomi Engineering is committed to completing the
MYR494m Kuala Lumpur Monorail expansion projectThe provider of public
transport solutions in the rail and commercial vehicle industries has completed
82.9% of the works. The project is almost complete, including installing
the signalling system and upgrading the stations. (Source: The Sun Daily)
|
|
|
|
|
No comments:
Post a Comment
Note: Only a member of this blog may post a comment.