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| | | | | | | | | | | | | | | | Share Price: | MYR3.01 | Target Price: | MYR3.19 | Recommendation: | Hold | | |
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| | | Growth 'Stationery' | | Asia File is an under-researched company that manufactures stationery products. We think demand for traditional filing and stationery products is likely to see minimal growth in the coming years. We estimate Asia File's earnings growth to be flattish over the next three years. Our TP is based on 11.6x FY19E P/E, this being its 5-year historical PER mean. Providing support to share price is a strong balance sheet and decent yields of more than 4.5%. | | |
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| | FYE Mar (MYR m) | FY16A | FY17A | FY18E | FY19E | Revenue | 389.9 | 350.3 | 359.0 | 367.4 | EBITDA | 103.4 | 75.9 | 73.0 | 72.9 | Core net profit | 64.2 | 57.2 | 53.1 | 53.2 | Core FDEPS (sen) | 33.3 | 29.6 | 27.5 | 27.6 | Core FDEPS growth(%) | 22.1 | (11.0) | (7.1) | 0.2 | Net DPS (sen) | 16.0 | 16.0 | 13.8 | 13.8 | Core FD P/E (x) | 9.0 | 10.2 | 10.9 | 10.9 | P/BV (x) | 1.1 | 1.0 | 1.0 | 1.0 | Net dividend yield (%) | 5.3 | 5.3 | 4.6 | 4.6 | ROAE (%) | na | na | na | na | ROAA (%) | 10.8 | 8.9 | 8.0 | 7.7 | EV/EBITDA (x) | 7.9 | 8.2 | 7.2 | 6.9 | Net debt/equity (%) | net cash | net cash | net cash | net cash |
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| | | | | | | | | | | | | | Share Price: | MYR3.23 | Target Price: | MYR3.90 | Recommendation: | Buy | | |
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| | | Management changes | | AirAsia announced some key changes to its key management line-up, notably five new appointments. Four of the appointments are long-time employees of the company and therefore no stranger to the duty. The only appointment from the outside is for the role of AirAsia Berhad CEO. We are confident that the business direction will remain the same given the founders are very much in charge of the group. No changes to our earnings forecasts and TP of MYR3.90 (10x 2018 PER). Maintain BUY. | | |
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| | FYE Dec (MYR m) | FY15A | FY16A | FY17E | FY18E | Revenue | 6,297.7 | 8,600.5 | 9,717.8 | 9,928.9 | EBITDAR | 2,629.9 | 3,233.4 | 3,567.7 | 3,405.0 | Core net profit | 177.7 | 1,518.0 | 1,521.2 | 1,303.0 | Core EPS (sen) | 6.4 | 54.5 | 45.5 | 39.0 | Core EPS growth (%) | 434.5 | 753.9 | (16.6) | (14.3) | Net DPS (sen) | 3.0 | 4.0 | 45.0 | 8.0 | Core P/E (x) | 50.6 | 5.9 | 7.1 | 8.3 | P/BV (x) | 2.0 | 1.4 | 1.7 | 1.5 | Net dividend yield (%) | 0.9 | 1.2 | 13.9 | 2.5 | ROAE (%) | 12.0 | 31.9 | 25.1 | 18.4 | ROAA (%) | 0.9 | 7.0 | 7.1 | 5.9 | EV/EBITDAR (x) | 5.2 | 4.7 | 5.2 | 6.0 | Net debt/equity (%) | 228.9 | 133.6 | 122.7 | 132.9 |
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| | | | | | | | | | | | | | Share Price: | MYR3.76 | Target Price: | MYR4.45 | Recommendation: | Buy | | |
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| | | 9MFY1/18: In line | | 9MFY1/18 results came in line, accounting for 74% of our FY estimate but ahead of consensus. Our forecasts are unchanged. Yinson remains one of our key O&G picks. We are positive over its business direction & prospects, earnings growth and cashflow strength. Our SOP-based TP, which offers an 18% upside, has upside bias, for it has yet to include potential earnings/NPV positives from FPSO Lam Son and Layang. | | |
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| | FYE Jan (MYR m) | FY16A | FY17A | FY18E | FY19E | Revenue | 1,038.6 | 764.2 | 1,000.5 | 1,139.7 | EBITDA | 261.0 | 283.8 | 560.9 | 697.6 | Core net profit | 173.1 | 219.5 | 375.3 | 340.5 | Core EPS (sen) | 16.2 | 20.6 | 35.2 | 31.9 | Core EPS growth (%) | 17.5 | 26.8 | 71.0 | (9.3) | Net DPS (sen) | 1.5 | 16.8 | 10.4 | 10.0 | Core P/E (x) | 23.2 | 18.3 | 10.7 | 11.8 | P/BV (x) | 1.8 | 1.7 | 1.3 | 1.2 | Net dividend yield (%) | 0.4 | 4.5 | 2.8 | 2.7 | ROAE (%) | 12.0 | 8.5 | 13.7 | 10.7 | ROAA (%) | 4.8 | 3.9 | 5.6 | 4.8 | EV/EBITDA (x) | 15.6 | 21.4 | 11.2 | 8.5 | Net debt/equity (%) | 51.9 | 114.7 | 72.9 | 54.9 |
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| | | | | | | | | | | | | | Share Price: | MYR1.70 | Target Price: | MYR1.95 | Recommendation: | Buy | | |
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| | | 2QFY18: Within estimates | | 2QFY4/18 results and second interim net DPS of 1.0sen (YTD: 2.0sen) were in-line. Earnings were mainly driven by Berjaya Starbucks (BStarbucks) but partly offset by operating losses at Kenny Rogers Roasters (KRR) Indonesia. We nudge down our FY18 earnings forecast by 6% and our TP by -5sen to MYR1.95 (unchanged 27x CY18 PER, -0.5SD). | | |
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| | FYE Apr (MYR m) | FY16A | FY17A | FY18E | FY19E | Revenue | 554.4 | 605.4 | 635.6 | 686.1 | EBITDA | 79.5 | 74.8 | 91.3 | 100.2 | Core net profit | 22.3 | 18.5 | 23.3 | 29.5 | Core FDEPS (sen) | 5.9 | 4.8 | 6.1 | 7.8 | Core FDEPS growth(%) | (13.7) | (17.2) | 26.2 | 26.8 | Net DPS (sen) | 4.3 | 3.5 | 3.3 | 4.1 | Core FD P/E (x) | 29.0 | 35.1 | 27.8 | 21.9 | P/BV (x) | 1.6 | 1.6 | 1.6 | 1.6 | Net dividend yield (%) | 2.5 | 2.1 | 1.9 | 2.4 | ROAE (%) | 5.4 | 2.8 | 5.9 | 7.3 | ROAA (%) | 3.1 | 2.4 | 3.0 | 3.7 | EV/EBITDA (x) | 11.2 | 11.7 | 9.2 | 8.3 | Net debt/equity (%) | 49.3 | 62.3 | 55.5 | 52.3 |
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| | | | | | NEWS | | | Outside Malaysia:
U.S: Fed raises rates, eyes three 2018 hikes as Yellen era nears end. Federal Reserve officials followed through on an expected interest-rate increase and raised their forecast for economic growth in 2018, even as they stuck with a projection for three hikes in the coming year. "This change highlights that the committee expects the labor market to remain strong, with sustained job creation, ample opportunities for workers and rising wages," Chair Janet Yellen said following the decision. In her final scheduled press conference, Yellen noted that her nominated successor, Jerome Powell, has been part of the consensus shaping the Fed's gradual rate-hike strategy. The 7-2 vote for the rate move, the Fed's third this year, raises the benchmark lending rate by a quarter percentage point to a target range of 1.25% to 1.5%. In another move that could tighten monetary conditions, the Fed confirmed that it would step up the monthly pace of shrinking its balance sheet, as scheduled, to USD 20b beginning in January from USD 10b. (Source: Bloomberg)
E.U: The EU said no substantial deals were reached at a WTO meeting in Buenos Aires, highlighting how multilateral trade relations are growing increasingly fraught. "I'm sad to say there is nothing," EU Trade Commissioner Cecilia Malmstrom told reporters. "There is no agreement at all. We are left in old trenches'" The European Union joined a frustrated chorus of negotiators in Buenos Aires, including the U.S., India and South Africa, after they failed to reach any multilateral agreement during three days of talks. Sharp divisions over the WTO's ability to police trade emerged after U.S. envoy Robert Lighthizer said the organization was losing its focus and spending too much energy litigating disputes. The EU echoed some of the U.S.'s frustrations with the ineffectiveness of multilateral negotiations, but also defended the WTO appeals system that the Trump administration has criticized. (Source: Bloomberg)
U.K: Consumers spared energy hikes for now even as prices jump. Britain's households may be safe from rising energy prices for the moment even after pipeline outages and a cold snap sent natural gas soaring to its highest in four years. This week's closure of the Forties pipeline in the North Sea and an explosion at a natural gas hub in Austria pinched supplies and boosted wholesale prices in the U.K. as much as 46%. But the biggest utilities, which supply both electricity and gas to customers, sell most of their output years in advance to protect themselves from market swings. That means that only a longer-term increase in costs will feed through to Britain's 27.1 million households, who have shouldered a big increase in electricity prices in the past year. (Source: Bloomberg)
Hong Kong: Monetary authority raises base rate to 1.75%. The Hong Kong Monetary Authority raises its base rate to 1.75% from 1.50%, according to the city's de facto central bank. (Source: Bloomberg) | |
| | | | | Other News:
Aeon Credit Service: IRB slaps Aeon Credit with extra MYR96.82m in tax bill. The Inland Revenue Board (IRB) has slapped Aeon Credit Service (M) with a MYR96.82m bill for additional income taxes with penalties for the years of assessment of 2010 to 2016. Aeon Credit Service (M) was served with notices of additional assessment with penalties for those years by the IRB on Tuesday. The company has appointed tax solicitors and is initiating proceedings to challenge the validity and legality of the said notices of additional assessment. These taxes and penalties were in relation to the IRB varying the loan transaction collaterised by receivables undertaken by the company with a local financial institution to that of a sale of receivables, which IRB did not specify which provision of the Income Tax Act 1967 in making this variation. (Source: The Edge Financial Daily)
MK Land: To sell off MYR362.9m worth of unsold units in 2 years. MK Land will focus on selling off unsold units from its completed projects worth up to MYR362.9m within the next two years. The bulk of the units are from the semi-detached Rafflesia development and Armanee Terrace condominium in Damansara Perdana, Petaling Jaya, as well as some units at Residensi Suasana in Damansara Damai and Meru Perdana in Ipoh. MK Land is also in the planning phase to develop affordable housing, namely Rumah Selangorku in Taman Bunga Raya, Bukit Beruntung and in Bandar Baru Gunung Semanggol in Bukit Merah, Perak, for which the construction works to in early 2019, pending respective approvals. (Source: The Edge Financial Daily)
Dolphin International: Indonesian unit sues PT Arka Jaya Mandiri. Dolphin International's subsidiary Dolphin Indonesia has filed a writ of summons in the High Court of Indonesia against PT Arka Jaya Mandiri in relation to a delay in completion of civil works. It has served a letter of demand to PT Arka via its solicitors, in relation to the additional expenses incurred mainly due to the delay in completion of civil work awarded to the defendant on January 3, 2013, for which there has been no response from PT Arka. The group is seeking IDR12.5b (MYR3.58m) in claims from PT Arka. The claims was calculated on a formula of 6% to the total expenses incurred to complete the unfinished and rectification works, as well as the additional expenses incurred due to the delayed in completion of civil work. (Source: The Sun Daily)
PUC: Launches e-wallet platform Presto. ACE-Market listed PUC, which is seeking approval for money raised initially for its renewable energy business to be pumped into its e-wallet business expansion, today launched Presto, a homegrown social marketing and e-wallet platform. The e-wallet service is targeted to go live in early 2018. PUC proposes to pump in MYR36m from a rights issue of irredeemable convertible unsecured loan stocks (Iculs) last year, earmarked for its renewable energy business, to be used for the e-wallet business expansion. A total of MYR42m was raised. (Source: The Sun Daily) | |
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