KUALA LUMPUR (May 11): Hong Leong IB Research has downgraded Tan Chong Motor Holdings Bhd (TCM) to “Sell” at RM3 with a lower target price of RM2.60 (from RM3) and said TCM achieved stronger Nissan sales volume of 13,600 units (up 13.6% y-o-y; down 1.1% qoq), driven by new launch X-Trail and aggressive marketing for existing models.

In a note today, the research house however said it believed 1Q15 result (expected to be released 13 May) to be disappointing given 1Q15 will be impacted by high marketing expenses and high forex exposure towards US dollar.

“Downgrade TCM to Sell with lower TP at RM2.60 (from RM3.00) as we do not expect meaningful rebound in sales and margins for the remaining year,” it said.