KUALA LUMPUR (Nov 13): Shares of Only World Group Holdings Bhd (OWG) rose as much as 4.1% in intraday trade today, emerging as one of the top gainers on Bursa Malaysia.

The stock rose to an intraday high of RM2.80. As at 3.20pm, it was trading at RM2.78, up 9 sen or 3.35% with 750,300 shares done. Its market capitalisation stood at RM510.6 million.

Yesterday, the leisure and hospitality services provider proposed a bonus issue of 37 million new shares of 50 sen each on the basis of one bonus share for every five existing shares on an entitlement date to be fixed and announced later.

It also posted flat net profit of RM3.05 million for the first financial quarter ended Sept 30, 2015 (1QFY16) from RM3.04 million a year ago, due to higher administrative expenses, mainly start-up costs incurred for new outlets at Komtar, Penang.

Revenue for 1QFY16 grew 18% to RM22.68 million from RM19.22 million in 1QFY15.

According to CIMB Research, OWG continues to be one of the research firm's high-conviction small cap stock picks.

"We trim our FY16–18 earnings per share by 1%–2% to account for higher interest cost arising from additional borrowings taken to fund the expanded space at Komtar, Penang, higher depreciation cost, also arising from the expanded space at Komtar, and lower effective tax rate from expected lower taxes due to the investment tax allowance under the tourism category," it said.

CIMB Research is raising its target price on OWG to RM4.93, from RM3.66 previously, with an unchanged "add" call.

(Note: The Edge Research's fundamental score reflects a company's profitability and balance sheet strength, calculated based on historical numbers. The valuation score determines if a stock is attractively valued or not, also based on historical numbers. A score of 3 suggests strong fundamentals and attractive valuations.)