KUALA LUMPUR (May 19): AllianceDBS Research has maintained its “Buy” rating on Suria Capital Holdings Bhd at RM2.39 with an unchanged target price of RM3.35 and said it expects the company’s 1QFY15 profit to be about 10% lower year-on-year at RM13.5 million dragged mainly lower by lower crude palm oil (CPO) exports from Sabah in 1Q15.
In a note today, AllianceDBS vice president for equity Cheah King Yoong said Suria Capital was slated to announce it results on May 25.
Cheah said that according to statistics from Malaysia Palm Oil Board (MPOB), CPO production in Sabah dropped by 17.5% y-o-y in 1Q15 to 1.13 million tonnes.
“We forecast FY15 net earnings of RM72 million for the group (RM60 million port operations and RM12 million property development).
“While we believe that the port operations are on track to meet our expectations despite the potentially slow 1Q, unforeseen delays in its property launches could pose a downside risk to our earnings forecasts.
“For now, we are maintaining our FY15 earnings estimates. Maintain Buy with an unchanged RM3.35 target price,” he said.