KUALA LUMPUR (OCT 11): BIMB Securities Research has maintained its "Buy" rating on GHL Systems Bhd with a lower target price of RM1.80 (from RM2 previously), and said it continues to favour the company for the strong prospects of its transaction payment acquisition (TPA) business.
In a note today, BIMB Securities said it expects GHL's merchant money lending activity in Malaysia and Thailand would further enhance operating leverage on top of the growing TPA business.
Nonetheless, it said near-term earnings risks are inherent amidst intense competition amongst banks while some of the merchants acquired are still in its gestation period.
"We pare down 2019-21F earnings estimates by 3-30% on higher net opex (operating expenditure) assumptions.
"We believe this is fair given the attractive long-term growth potential it offers," it said.
At 11.16am, GHL rose 1.5% or 2 sen to RM1.35, valuing it at RM1.01 billion.