CSC up on dividends; AmInvestment says 'value has emerged'

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KUALA LUMPUR (Feb 13): CSC Steel Holdings Bhd rose as much as seven sen or 5% to RM1.58 after the company proposed total dividends at 10 sen a share. The dividends comprise an interim and a final payout of five sen each, according to CSC's statement to Bursa Malaysia.

CSC announced its dividends together with its income statement. CSC said net profit rose to RM14.82 million in the fourth quarter ended Dec 31, 2017 from RM6.19 million a year earlier. Full-year net profit however fell to RM59.81 million from RM68.69 million a year earlier.

At 9:19am today, CSC shares were traded at RM1.56. Earlier at 9:17am, the stock was transacted at RM1.58 to become Bursa Malaysia's ninth-largest gainer.

AmInvestment Bank Bhd wrote in a note today: "CSC Steel's FY17 core net profit of RM62.3 million (excluding RM2.5 million inventory write-down) met our forecast and consensus estimates."

"We upgrade CSC Steel from hold to buy, while maintaining our forecast and FV (fair value) of RM1.83 based on 10x FY18F EPS, in line with the average forward PE of major global key steel producers. This is because value has emerged after the steep fall in share price in recent months," AmInvestment said.