KUALA LUMPUR (May 11): CIMB IB Research has maintained its “Hold” rating on Gas Malaysia Bhd (GMB) at RM3.10 with a higher target price of RM2.99 (from RM2.83) and said GMB’s 1Q17 net profit broadly met expectations, at 21% of house and consensus full-year forecast.
In a note May 10, the research house said it expects stronger earnings in 2H17 on the back of higher sales volume.
It said no dividend was declared for the quarter, similar to previous year’s practice.
“We fine-tune our FY17-19F EPS by -1% to -2% after updating our forecasts with the latest numbers. Our target price rises to RM2.99 after increasing our target P/E multiple.
“Our target price basis remains its 1-year average P/E. Our new target price is based on 22x CY18F P/E (rolling forward from previous average of 20.4x). The stock remains a Hold,” it said.