HLIB raises target price for TSH Resources to RM1.60

HLIB raises target price for TSH Resources to RM1.60
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KUALA LUMPUR (May 25): Hong Leong Investment Bank (HLIB) Research has maintained its “hold” rating on TSH Resources Bhd at RM1.44 with a higher target price (TP) of RM1.60 (from RM1.58) and said TSH’s 1Q22 core net profit of RM45.7 million (-36.8% q-o-q; +48.5% y-o-y) came in within expectations, accounting for 24.5-25.1% of its and consensus full-year estimates.

In a note on Wednesday (May 25), the research house raised its FY22-24 core net profit forecasts for TSH by 5.1%/15.8%/9.9%, mainly to account for: i) higher CPO price assumptions (RM5,500/4,500/4,500 per tonne in FY22-24 following its recent upward revision in CPO price assumptions for the sector); ii) higher CPO production cost assumptions at upstream segment; and iii) lower FFB output assumptions.

“Post earnings revision and recalibration of earnings model, we maintain our 'hold' rating on TSH with a higher TP of RM1.60 (from RM1.58 earlier),” it said.