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NewsMIDF Research maintains Buy on Tan Chong, cuts target price to RM4.60
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MIDF Research maintains Buy on Tan Chong, cuts target price to RM4.60
by Cals Fri 28 Nov 2014, 01:58
MIDF Research maintains Buy on Tan Chong, cuts target price to RM4.60
KUALA LUMPUR (Nov 27): MIDF Research has maintained its Buy rating on Tan Chong Motor Holdings Bhd ([You must be registered and logged in to see this image.]Financial Dashboard) with a lower target price of RM4.60 (from RM5.55) and said the company’s core earnings eroded further as the sequential improvement in sales volume was more than offset by hefty discounts in order to defend Nissan’s market share.
In a note Thursday, the research house said this was reflected in inventory levels easing to RM1.6 billion from RM1.7 billion in 2Q14.
“We expect some mild earnings respite in the final quarter with its Vietnam operations normalises.
“We reduced our FY14 forecast by 41% and pared down our FY15 and FY16 expectations as we take a more conservative view on Tan Chong’s outlook.
“We reduce our target price to RM4.60 from RM5.55 while retaining our Buy recommendation as Tan Chong’s share price has corrected,” it said.
KUALA LUMPUR (Nov 27): MIDF Research has maintained its Buy rating on Tan Chong Motor Holdings Bhd ([You must be registered and logged in to see this image.]Financial Dashboard) with a lower target price of RM4.60 (from RM5.55) and said the company’s core earnings eroded further as the sequential improvement in sales volume was more than offset by hefty discounts in order to defend Nissan’s market share.
In a note Thursday, the research house said this was reflected in inventory levels easing to RM1.6 billion from RM1.7 billion in 2Q14.
“We expect some mild earnings respite in the final quarter with its Vietnam operations normalises.
“We reduced our FY14 forecast by 41% and pared down our FY15 and FY16 expectations as we take a more conservative view on Tan Chong’s outlook.
“We reduce our target price to RM4.60 from RM5.55 while retaining our Buy recommendation as Tan Chong’s share price has corrected,” it said.
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