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Maybank IB Research starts coverage on AFG, target price RM5.50

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Maybank IB Research starts coverage on AFG, target price RM5.50 Empty Maybank IB Research starts coverage on AFG, target price RM5.50

Post by Cals Thu 19 Jun 2014, 03:11

Maybank IB Research starts coverage on AFG, target price RM5.50
Business & Markets 2014
Written by theedgemalaysia.com   
Wednesday, 18 June 2014 11:29

KUALA LUMPUR (June 18):   Maybank IB Research has started coverage on Alliance Financial Group Bhd (AFG) at RM4.69 with a Buy rating and target price of RM5.50 for exposure to a small niche bank with strong fundamentals.
In a note Wednesday, the research house said AFG’s high capitalisation level promotes strong dividend payout (decent 4.9% FY15 yield) and ROE enhancement.
“AFG may be the smallest financial group in Malaysia by asset size, but what it lacks in scale is more than compensated for through its focus on customer service, its comfortable niche in the consumer and SME space, a sticky retail deposit franchise and its very decent asset quality,” it said.
The research house also said there has long been speculation that AFG’s major shareholder, Vertical Theme, would consider disposing off its 29% stake.
“We do think that AFG would be quite a tidy bank to acquire given its strong fundamentals and niche in SME financing.
“As such, we would not rule out AFG as a potential future acquisition target,” it said.
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