KUALA LUMPUR (May 31): Shares in Rohas Tecnic Bhd rose 10.4% in early trade on Tuesday (May 31) following its firmer first-quarter earnings and positive technical outlook.
At 9.32am, Rohas had added 2.5 sen to 26.5 sen, with 719,000 shares traded.
Hong Leong Investment Bank Research upgraded Rohas to “buy” at 24 sen with a higher target price (TP) of 32 sen (from 29 sen) and said the company’s core profit after tax and minority interest (PATAMI) of RM6.8 million for the first quarter ended March 31, 2022 (1QFY22) was better than expected due to stronger contributions from both the engineering, procurement, construction and commissioning (EPCC) and tower segments.
In a note on Tuesday, the research house said that it expects a better year ahead for Rohas with a broad recovery in its business segments.
“We increase our FY22/23 earnings forecasts by 25.1%/45.5%.
“We upgrade Rohas to 'buy' with a higher TP of 32 sen post earnings revision.
“Our TP is derived by pegging mid-FY22 earnings per share at eight times price-earnings (P/E) multiple. With the results posting a positive surprise, coupled with a weak share price performance (-20% year-to-date), we reckon that the stock is ripe for a rebound, trading at FY22/23/24 P/E multiples of 6.6/5.6/six times,” the research house said.