STOCK FOCUS OF THE DAY
Lafarge Malaysia: A subdued 4QFY17 in the cards HOLD
We cut our FV and earnings forecast for Lafarge Malaysia's (LM) FY17-18F, projecting a higher net loss of RM192.0mil and RM16.4mil in FY17 and FY18F respectively (vs. net loss of RM165.1mil and net profit of RM4.7mil in FY17-18F previously). We maintain our earnings projection for FY19, and trim our FV to RM4.05 (from RM4.23 previously). Our FV is based on 1.25x revised FY18F BVPS, consistent with its historical P/B ratio during the transitional period between the trough and mid-cycles.
We anticipate weaker-than-expected 4Q17 results for LM, following the subdued results (for the Oct-Dec 2017 quarter) posted by LM’s peers like Tasek Corporation and Hume Industries. Both companies saw a QoQ decline in their revenue and earnings.
QUICK TAKE
Plantation Sector: News flow for week 12 — 15 February NEUTRAL
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