Company Update � Bonia (ADD, maintain)
- Regional expansion to fuel growth
We maintain our positive view on the long-term
prospects of the group as a regional upper-mid-range retailer. In our view,
Bonia�s growth for the next few years will continue to be backed
by: i) increasing sales volume in tandem with improved brand recognition
through its in-house brands and licences, ii) regional expansion of its
boutique stores, particularly in Indonesia and Vietnam, to create better
brand awareness, and iii) on-going store refurbishments and consolidation of
unprofitable outlets to improve operating efficiencies through the
reallocation of resources. Given the better prospects we see ahead for Bonia,
we lift our 12-month target price to RM1.61 (from RM1.36). Maintain ADD
rating.
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