Alliance Research upgrades Affin Holdings to 'buy'

Alliance Research upgrades Affin Holdings to 'buy'
Business & Markets 2013
Written by Bernama
Tuesday, 04 June 2013 14:19


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KUALA LUMPUR (June 4): Alliance Research has upgraded its rating on Affin Holdings from "neutral" to "buy" with a target price of RM4.78, as it believes value for the stock has re-emerged following the recent sell down.

In a research note, Alliance Research said since its downgrade of Affin to neutral on May 27, share prices had retraced from RM4.51 to RM4.17.

"But we observe that its valuation is becoming increasingly attractive since then," the research house said.

It said other than attractive valuation, Affin serves as a good proxy for exposure to the domestic mergers and acquisitions (M&A) theme, where foreign strategic shareholders are expected to raise their shareholdings in domestic banks.

"As highlighted previously, we expect new M&A flow in the banking sector to re-emerge post the 13th General Election.

"We believe the increasingly competitive environment going forward, could induce smaller domestic banks to consolidate and pursue further integration with foreign strategic partners, leading to heightened investor interest in banks such as Affin," Alliance Research added.