FW: AmBank Research - OldTown : Resurgent FMCG draws 2QFY18 earnings in line BUY, 30 Nov 2017

 

 

STOCK FOCUS OF THE DAY         

OldTown : Resurgent FMCG draws 2QFY18 earnings in line                           BUY

 

OldTown’s 2QFY18 results were in line as remarkable China-led FMCG revenue off the back of robust margins offset a sluggish F&B segment. We maintain our BUY recommendation and FV of RM3.20. Our FV is based on 17.0x CY18F P/E, which is a 20% discount to the simple PE of its FMCG peers of 23x. An interim dividend of 3.0 sen/share was declared. OldTown registered a 2QFY18 profit of RM15.2mil (QoQ: -9%, YoY: +20%), bringing 1HFY18 to RM32mil (YoY: +21%). It came in line with our and consensus forecasts, at 44% and 46% of our earnings estimates respectively

 

Cumulative FMCG revenue grew 22% YoY, beating our estimates of 17%. Sales across all geographies with the exception of Hong Kong grew impressively. Most notably, China expanded at a breakneck 78% YoY for the quarter. Cumulatively, China grew c:50% by our estimates, surpassing management’s guidance of 20-30% growth. We maintain our forecasts with earnings falling in line.

 

Others :

Bonia Corp : Robust outlook ahead despite soft quarter                                BUY

Cahya Mata Sarawak : 9MFY17 core net profit grows 9% YoY                        BUY

Ikhmas Jaya : 3QFY17 core net profit surges sequentially                               BUY

Kimlun Corp : 9MFY17 net profit declines 23% YoY                                            BUY

Protasco : A soft patch in 9MFY17, but stronger prospects ahead               BUY

Magnum : Ticket sales still weak                                                                                HOLD

Padini : Valuations run ahead of regional prospects                                          HOLD

Media Prima : Another round of kitchen-sinking                                                SELL

Plantation Sector : 3Q2017 Earnings Review: A mixed quarter                      NEUTRAL

 

 

 

QUICK TAKE

MSM Malaysia : Marginal impact from gas tariff hike                                       HOLD

 

 

STOCKS ON RADAR

Cuscapi, George Kent, Uzma, Malaysian Resources Corporation

 

 

ECONOMIC HIGHLIGHT

US : US – Fastest 3Q GDP growth since 3Q2014

 

 

NEWS HIGHLIGHTS

Investment : EPF 3Q investment income up 5.13%

Barakah Offshore Petroleum : Ties up with Samling Group for jobs in Sarawak

AirAsia : Group earnings up 42.9% to RM505.32m

Dolomite : Shuts down loss-making power business for now

 

 

 

 

 

DISCLAIMER:

The information and opinions in this report were prepared by AmInvestment Bank Bhd. The investments discussed or recommended in this report may not be suitable for all investors. This report has been prepared for information purposes only and is not an offer to sell or a solicitation to buy any securities. The directors and employees of AmInvestment Bank Bhd. Bhd may from time to time have a position in or with the securities mentioned herein. Members of the AmBank Group Bhd and their affiliates may provide services to any company and affiliates of such companies whose securities are mentioned herein. The information herein was obtained or derived from sources that we believe are reliable, but while all reasonable care has been taken to ensure that stated facts are accurate and opinions fair and reasonable, we do not represent that it is accurate or complete and it should not be relied upon as such. No liability can be accepted for any loss that may arise from the use of this report. All opinions and estimates included in this report constitute our judgment as of this date and are subject to change without notice.

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

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