Berjaya Auto shares up after analysts initiate coverage, Buy call

KUALA LUMPUR: Shares of Berjaya Auto rose after analysts initiated coverage on the stock with a Buy rating.
At 2.39pm, Berjaya Auto rose 21 sen to RM1.69 with some 6.7 million shares done between RM1.48 and RM1.73.
The FBM KLCI was up marginally at 0.91 of a point to 1,825.2. Turnover was 614.21 million valued at RM615.7mil. There were 268 gainers, 345 decliners and 300 counters unchanged.
In a note on Wednesday, AmResearch said it has AmResearch has initiated its coverage on Berjaya Auto with a Buy and a fair value of RM2.10 a share.
AmResearch said its high conviction Buy on Berjaya Auto was based on several factors which include a massive 68% earnings compounded annual growth rate over FY13-16F riding on a strategic transition to a completely knocked down business model.
“Other factors included it being a key beneficiary of Malaysia’s soon-to-be announced EEV program, the best Malaysian proxy to high growth and underpenetrated auto markets within ASEAN and a capex-light, high growth business structure with a solid balance sheet - net cash of RM114mil post-IPO,” it said.