AmResearch maintains "buy" on Star, FV RM3.10

AmResearch maintains "buy" on Star, FV RM3.10
Business & Markets 2013
Written by Kamarul Anwar of theedgemalaysia.com
Tuesday, 11 June 2013 15:34


A + / A - / Reset
KUALA LUMPUR (June 11): AmResearch has retained its “buy” rating on STAR PUBLICATIONS (M) BHD [] at an unchanged far value of RM3.10.

In a note today, AmResearch said the publisher of the widest-circulated English Daily had reiterated its intention to expand its non-print businesses, particularly its digital and TV segments.

Star endeavours to expand its non-print mediums in order to reduce its reliance on the print segment. AmResearch estimated Star’s new pay TV channel, LiTV, will break even in its financial year ending December 31, 2014 (FY14).

According to the research house, Star's management said its exhibition and event management company Cityneon Holdings Ltd had recently closed two major deals in China, "which should contribute positively to its earnings".

However, AmResearch said the management did not elaborate on the matter.

The research house said Cityneon is currently undergoing a reorganisation exercise by aligning its efforts to grow its interior design business instead of its exhibition businesss. This is due to the latter seen to be declining.

“(Star’s) management expects dividend-per-share to be maintained flat at 18 sen, in line with its historical payout. This equates to an attractive yield of 6%. At the current level, the stock is trading at a price-earnings ratio level of 13 times FY13F, at parity with MEDIA PRIMA BHD []’s and ahead of MEDIA CHINESE INTERNATIONAL LT []d’s 10 times,” said AmResearch

At 2:55 pm, Star's counter retreated two sen or 0.71% to RM2.79. A total of 421,300 shares changed hands.