STOCK FOCUS OF THE DAY
Bison Consolidated : 3QFY17 results fall in line BUY
Bison Consolidated (Bison) steadfastly delivers on earnings. We upgrade our recommendation to BUY from HOLD following its share price retracing some 15%. It follows the corporate exercise announcement, which we feel is overdone. Our fair value of RM2.55/share is pegged to an unchanged PE of 27x CY18F earnings, which is in line with 7-Eleven Malaysia’s (7E Malaysia) historical valuations. Our FV has factored in the impact arising from its corporate exercise, which dilutes FY18-19F EPS by -8% given an enlarged share base of 10%.
We like Bison for its excellent execution track record and attractive 3-year earnings CAGR of 31% over FY16-19F (vs. 7E Malaysia: 6.6%). It has the potential to enhance margins going forward through: i) its own in-house food processing centre; and ii) greater economies of scale.
Bison reported a 3QFY17 core net profit of RM6.2mil (QoQ: -1%, YoY: 52%). It brought cumulative earnings to RM18.7mil (YoY: 36%). Earnings were in line with our and consensus estimates, both at 78%. No dividend was declared as expected.
Others :
Dialog Group : Adding 36% stake in Tanjung Langsat terminal BUY
MISC : Minimal impact from sale of Tanjung Langsat terminal stake HOLD
STOCKS ON RADAR
Boilermech Hldgs., Muar Ban Lee Group, Media Prima, Berjaya Sports Toto
ECONOMIC HIGHLIGHT
Singapore : MAS to continue neutral stance
NEWS HIGHLIGHTS
Construction Sector : China’s CCCC to make KL its Asean hub, build tower at TRX
Construction Sector : Call for S’pore-JB project tenders by year-end
S P Setia : Raises RM434m via sukuk for Penang land buy
Berjaya Land : Makes RM11.5 million net profit for Q1
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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