CGS-CIMB raises target price for DRB-Hicom to RM3.10

CGS-CIMB raises target price for DRB-Hicom to RM3.10

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KUALA LUMPUR (Feb 19): CGS-CIMB Research has maintained its “Add” rating on DRB-Hicom Bhd at RM2.29 with a higher target price (TP) of RM3.10 (from RM2.70) and said DRB-Hicom stands to benefit from Proton’s earnings growth in 2020F and potential Shah Alam land monetisation following Proton’s relocation.

In a note Feb 18, the research house said it expects 15% rise in Pos Malaysia revenue in 2020F after recent postage rates revision which should help boost its services division’s profitability.

“We reiterate Add with a higher RM3.10 SOP-based TP to reflect Proton and Pos Malaysia Bhd earnings recovery and exclude contribution from Alam Flora,” it said.