CIMB Research introduces end-2018 FBM KLCI target of 1,920

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KUALA LUMPUR (Oct 30): CIMB IB Research has maintained its end-2017 FBM KLCI target of 1,790 points (based on forward P/E of 16x).

In a note Oct 27, the research house said using the same P/E multiple but rolling forward house valuations, it arrived at an end-2018 FBM KLCI target of 1,920 points.

“We continue to favour construction, utilities and small-caps, and our top three picks are Tenaga Nasional Bhd, Gamuda Bhd and Axiata Group Bhd.

“The key surprise for us in the 2018 Budget was the reduction in personal income tax.

“This and special payments to civil servants should boost consumption spending,” it said.

The research house said sector winners are construction, property, consumer, F&B and healthcare.

“Overall, we view the budget to be mildly positive for the market,” it said.