CIMB Research downgrades UMW, lowers target to RM6.10

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KUALA LUMPUR (Jan 29): CIMB IB Research has downgraded UMW Holdings Bhd to “Hold” at RM5.99 with a lower target price of RM6.10 (from RM6.36) and said the group expects stronger sales volume growth from Toyota and Perodua in 2019F, driven by new model launches and capacity expansion at Bukit Raja.

In a note Jan 28, the research house said in spite of UMW’s attractive prospects, it cut its FY19-20F EPS by 4-5% due to higher cost related to its RM1.1 billion perpetual sukuk issued in 2018.

“Downgrade to Hold, with a lower RM6.10 target price. Switch to Bermaz Auto Bhd,” it said.