HLIB Research maintains Buy on MBM Resources, ups target to RM4.28

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KUALA LUMPUR (March 3): Hong Leong IB Research has maintained its “Buy” rating on MBM Resources Bhd with a higher target price of RM4.28 (from RM4) and said that in FY14, MBM reported lower year-on-year earnings due to lower lower group sales volume and higher startup related cost (for OMI Alloy Wheel, Hino and Perodua).

In a note Tuesday, the research house said it expects stronger earnings in 2015, with stronger Perodua sales, full year earnings from new Hino plant, and lower losses/breakeven from OMI alloy wheel plant.

“The on-going focus on sales after-services has been bearing fruits with continued expansion into service centers.

“Maintained Buy with higher target price of RM4.28 (from RM4.00) based on SOP,” it said.