Dufu to test 70 sen-80 sen in the medium to long term, says HLIB Research

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KUALA LUMPUR (Aug 10): Hong Leong IB Research said Dufu Technology Corp Bhd is set to test 70 sen - 80  sen in the medium to long term, and that Dufu remained cautiously optimistic of 2016 despite the challenging hard disk drive (HDD) industry, mainly driven by continued innovation process and other improvements to increase production efficiency together with the development of new product mix with HDD & non HDD customers.

In a trading idea note today, the research house said that at 63.5 sen, Dufu is trading at trailing 7.3x P/E (12% below 10-year average of 8.3x and 44% lower than industry 13.1x), supported by attractive PBT margin of 12.9% (vs industry 5.8%).

“Following a bullish flag breakout yesterday, Dufu is envisaged to test 67.5 sen -70 sen zones in the near term, before advancing further to long term objective at 80 sen.

“Key supports are 60 sen - 61.5 sen. Cut loss at 59 sen,” it said.