KUALA LUMPUR (Nov 25): Parkson Holdings Bhd rose as much as six sen or 6% after the retail group reported a significant rise in first quarter net profit from a year earlier.

Yesterday, Parkson said net profit rose to RM63.29 million in the first quarter ended Sept 30, 2015 from RM20.22 million. Revenue was higher at RM933.39 million versus RM848.62 million.

Today, Parkson shares to their highest so far at RM1.06. At 9:25am, the stock was traded at RM1.05 with 916,800 units transacted. At 9:43am, Parkson saw 1.06 million shares done.

At RM1.05, Parkson has a market value of RM1.15 billion. Despite, Parkson's net profit rise, Public Investment Bank Bhd said in a note today the figure was "off our estimates".

Excluding Parkson's disposal gain, Public Investment said the company would have seen a core net loss of RM73 million.

"The unfavourable core net loss is mainly due to higher operating costs, namely staff costs, depreciation and amortisation as well as rental expenses, as Parkson remain focused on revamping and transforming stores across its main regions. 

"1Q has traditionally been a weak quarter due to seasonality. As such, we expect PHB (Parkson) to perform better in the upcoming quarters as it takes advantage of the year-end holidays and festivities, counting on it to provide greater cushion to buffer its escalating costs coming from new business ventures and new stores," Public Investment said.

Public Investment maintained its "outperform" call for Parkson shares with an unchanged target price of RM1.48.

(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.)