8 August 2008
UNDERPERFORM Maintained
RM5.05 Target: RM5.00
Mkt.Cap: RM31,006m/US$9,444m
Dry spell..........................oil price of US$120 per barrel.
foreword(序言) is repeated please click here if you want to read
Valuation and recommendation
Chopping target price to RM5.00 despite unchanged earnings numbers. Although we retain our earnings forecasts, our target price is scaled back from RM6.50 to RM5.00 as we adopt a lower forward PE of 13x instead of 15x. Our forward P/E of 13x is based on a discount of one multiple point to its three-year historical average forward P/E. The discount reflects mainly our concern over its exposure to the Singapore property market, political risk in Malaysia and its high foreign shareholding.
Maintain UNDERPERFORM call. Bearing in mind the heightened earnings risk stemming from softer CPO price prospects, we maintain our UNDERPERFORM call. The upside to our revised target price is lower than the market’s. Potential de-rating catalysts include the softer CPO price, lower crude oil price, weaker property earnings and higher-than-expected operating costs.
No comments:
Post a Comment