STOCK FOCUS OF THE DAY
Lafarge Malaysia : Outlook remains challenging HOLD
We maintain our HOLD call but raise our FV for Lafarge Malaysia (LM) to RM4.45 (from RM3.55) as we switch our valuation methodology from earnings-based (P/E) to asset-based (P/B). As LM's earnings are likely to remain depressed over the medium term, an earnings-based valuation methodology becomes less relevant. We now value LM based on 1.25x P/B, consistent with its historical P/B during the transitional period between trough and mid cycle.
We now project LM to make a net loss of RM23mil in FY17F (from a net profit of RM12mil previously). We also cut FY18-19F net profit forecasts by 29% and 15% respectively. This follows our slight disappointment after a recent visit to the company.
Others :
Felda Global : CEO is back HOLD
LPI Capital : Net profit lifted by unearned premium reserves’ release HOLD
STOCKS ON RADAR
Lion Industries, Willowglen MSC, RGB International, Hibiscus Petroleum
NEWS HIGHLIGHTS
Mudajaya : Bags RM1.16b LRT3 job from Prasarana
Hovid : MD launches offer to take company private
KNM : To partner with China-based firm for UK power plant
Serba Dinamik : Signs JV deal for Tanzania plant
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