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Kenanga Research trims MISC'S earnings forecast
by Cals Tue 25 Mar 2014, 00:40
| Kenanga Research trims MISC'S earnings forecast |
| Business & Markets 2014 |
| Written by Bernama |
| Monday, 24 March 2014 11:29 |
KUALA LUMPUR (Mar 24): Kenanga Research has trimmed its core earnings forecast on MISC Bhd for financial years (FY) 2014 and 2015 by 0.5 per cent and 0.6 per cent, respectively, as a result of the disposal of a MISC unit.
It was reported that MISC would dispose of its wholly-owned subsidiary MISC Integrated Logistics Sdn Bhd (MILS) to Golden Age Logistics Sdn Bhd, a special purpose vehicle wholly-owned by Utusan Printcorp Sdn Bhd, for RM250 million cash.
In a note today, Kenanga Research said the reduced earnings forecast was to account for the loss of income from the logistics business.
"This disposal is not a surprise to us as MISC has been looking to divest their non-core businesses and focus on their core shipping business.
"We are positive on this disposal, as this allows MISC to cash out from their logistics business at a favourable price which also frees up more cash for investment in energy and petroleum related shipping business in which the operating conditions may improve in the medium term," it added.
Following this, Kenanga Research has maintained its "Underperform" call on the Malaysian shipping conglomerate with a higher target price of RM6.87.
As at 10.48 am, MISC's shares shed two sen to RM6.99 with 565,400 lots changing hands.
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