KUALA LUMPUR (Dec 5): Affin Hwang Capital Research has upgraded Bermaz Auto Bhd to “Buy’ at RM2.05 with an unchanged target price of RM2.30 and said Bermaz’s 1M-share price has fallen by circa 9%, as 2QFY20 quarterly results, slated for release on Dec 10, is expected to be sequentially weaker due to the delay in car pricing approvals for its CX-8 model.
In a note today, the research house said that the issue has been resolved, and will not affect Bermaz’s 2HFY20 outlook.
“At 11x PER/ 6% yield for FY20E, we believe the negatives are priced in and valuations look attractive.
“Upgrading to Buy (from Hold) with an unchanged TP of RM2.30 based on 12x CY20E PER. Key downside risks: supply constraints on Mazda model and forex risks,” it said.