Isnin, 10 Mac 2014

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The Star Online: Business

Better prospects for PPB divisions this year

Posted: 10 Mar 2014 09:00 AM PDT


By Hwang-DBS Vickers Research

Hold (maintain)

Target price: RM15.30

HWANG-DBS Vickers Research said PPB Group Bhd was on firmer footing this year backed by better prospects for most key divisions.

The research house said PPB's second 1,000 tonnes per day flour mill that was commissioned in Indonesia in November and an additional 150 tonnes per day mill in Vietnam, should bring higher volumes to its flour and feed milling and grains trading divisions.

Hwang-DBS initially assumed PPB's margins would expand to 7.3% in the financial year ending Dec 31, 2014 from 6.6% in 2013 on the back of stable wheat prices, and better efficiency and scale at its Indonesian operations. However, it said the company could face some downside risks should the Ukraine issue persists, as it was the sixth largest wheat exporter in the world, adding that the continuous unrest in Ukraine had pushed wheat prices up to its highest in 18 months.

Hwang-DBS Vickers said the cinema division had been performing consistently, with the delivery of 15% growth in earnings before interest and tax to RM50mil in 2013, adding that PPB planned to open six more cinemas (60 screens) in 2014, bringing the total screens to 293.

It said GSC had about 29% in market share by screens and 40% by revenue and that there was room to grow for at least three to five more years. PPB was budgeting RM440mil for capital expenditure over the next one to two years, which would be used mostly for flour and feed milling, and cinema. The research house said PPB's valuation was fair at 17.5 to 18 times 2014 to 2015 price-earnings, on the back of modest growth.

Its relative bet is Wilmar, which has a cheaper valuation. It said PPB's market capitalisation was at a large premium to its share of Wilmar's market capitalisation.


By AmResearch

Buy (maintain)

Target price: RM4.50

AMRESEARCH has reaffirmed its "buy" recommendation for Bonia Corp Bhd, with an unchanged target price of RM4.50 per share, pegged to a 10 times price-earnings over Bonia's calendar year 2015 forecast earnings.

It believed Bonia's growth in the next few years would be driven by rising sales volume, on the back of strong brand recognition, compelling product range and increasing regional footprint.

It said although Bonia would be selective in new boutique openings, it would continue to strengthen its brand recognition and expand aggressively into Indonesia.

AmResearch also said Bonia was also well-positioned to capitalise on the economic recovery in Vietnam with an extensive distribution network of 17 boutiques and 28 counters. It said expansion of Braun Buffel would be through company-owned boutiques, exports of licensing. It said Bonia currently exported Braun Buffel products to Indonesia and has given out a licence in China, where the licensee owned more than 100 outlets. AmResearch said Bonia's in-house brands and Braun Buffel could enter new markets, particularly in Asia by potential tie-ups with established partners.

It said Bonia traded at an undemanding valuation of only nine times 2015 price-earnings, taking into account its significant earnings expansion and a robust three-year compounded annual growth rate of 35%.


By AmResearch

Buy (maintain)

Target price: RM2.00

FOLLOWING Berjaya Food Bhd's weaker-than-expected third quarter results, AmResearch has maintained its "buy" recommendation on the stock, with a lower target price of RM2 per share.

Net profit for the company rose 26% year-on-year for the nine-month period ended Jan 31, 2014, driven by increased sales. No dividends were declared during the quarter.

AmResearch said the nine-month results represented 67% of its full-year projections of RM26mil, below its expectations.

It said third quarter sales were affected by the flood situation in Kuantan, closure of Genting Outdoor Theme Park, temporary closure of Ipoh Parade Mall, softer consumer spending and slower-than-expected sales for Jollibean Singapore.

Nine-month same-store-sales growth (SSSG) were 2% for Kenny Roger Roasters (KRR) Malaysia, 5% for KRR Indonesia, and 13% for Starbucks Malaysia.

AmResearch trimmed the earnings per share forecast by 13% to reflect flat SSSG for KRR Malaysia and Jollibean Singapore. It forecast 2014 earnings to grow by 22% to RM23mil. It said Starbuck's exponential expansion and robust consumption demand was expected to remain strong and that prospects of its foray into Brunei in February look promising. The research house expected minimal contribution in 2014.

It added Berjaya Food was expected to open four outlets for KRR Malaysia, two outlets for KRR Indonesia, 11 outlets for Starbucks Malaysia, and two outlets for Jollibean Singapore by the end-2014, bringing the total to 336 outlets.

KLCI inches up, HL Bank, plantations climb

Posted: 10 Mar 2014 06:15 PM PDT

KUALA LUMPUR: The FBM KLCI inched up early Tuesday, boosted by gains in Hong Leong Bank and plantations but analysts are still cautious especially after the selling the previous day.

At 9.02am, the KLCI was up 2.42 points to 1,824.48. Turnover was 29.69 million shares valued at RM15.62mil. There were 103 gainers, 67 losers and 121 counters unchanged.

Hwang DBS Vickers Research said the FBM KLCI, after plunging to a low of 1,817 before staging a subsequent partial recovery to close at 1,822 on Monday, the 30-stock index could face renewed selling pressure on Tuesday.

"Technically speaking, the KLCI's upside may be capped at the immediate resistance threshold of 1,825 with its key support currently seen at the psychological 1,800 level," it said.

Plantations were among the major gainers, underpinned by the firm crude palm oil prices as production shrinks.

United Plantations rose 70 sen to RM25 while PPB added 26 sen to RM16.40, KL Kepong 20 sen to RM23.98 and Genting Plantations 16 sen to RM11.04.

Hong Leong Bank rose 22 sen to RM14.18 but Public Bank shed eight sen to RM18.96.

Kian Joo jumped 29 sen to RM3.50 after it received a letter of interest from Toyota Tsusho Corporation for a possible purchase of 51% of its paid-up capital at a tentative maximum price of RM3.74 per share.

MAHB fell 14 sen to RM8.10 on concerns about rising costs. Petronas Gas lost 14 sen to RM22.84 and Petronas Daganagan 1`0 sen to RM29.88.

Puncak Niaga fell eight sen to RM3.27. In the latest development, Gamuda and Puncak Niaga rejected the offer by Selangor government to take over their water assets.

Boeing joining Malaysia Airlines crash investigation

Posted: 10 Mar 2014 05:43 PM PDT

NEW YORK: Boeing said Monday it has joined an official US team investigating the still-mysterious disappearance of a Malaysia Airlines 777 aircraft, feared to have plunged into the Gulf of Thailand.

Boeing said it would act as technical advisor to the US National Transportation Safety Board team already in Southeast Asia to offer assistance.
The Malaysia Airlines plane that went missing Saturday on a flight from Kuala Lumpur to Beijing was a Boeing 777, a model which up to now has seen only one fatal crash.
The popular family of long-range, wide-body, twin-engined planes have a solid safety record and have been among the world's most widely flown passenger jets since first entering service in 1995.
In the sole fatal crash involving the planes, a Boeing 777-200 operated by South Korea's Asiana Airlines skidded off the runway upon landing at San Francisco's international airport in July 2013, with three dead as a result.
The Malaysia Airlines flight that lost contact with authorities Saturday was a Boeing 777-200, with 239 people aboard.

Boeing said in a statement that it "continues to offer its thoughts and deepest concern to the families of those aboard Malaysia Airlines flight 370, which went missing on March 8." - AFP


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