Period 1QFY12/3MFY12
Actual vs.
Expectations
Within ours
and the consensus expectations.
The 1QFY12
net profit made up 25% and 27% of our estimate and consensus forecast of RM163.4m
and RM199.6m, respectively.
Dividends No
dividend was declared.
Key Result Highlights
QoQ, 1Q12
earnings improved by 38% with a significant improvement in the PBT margin,
which increased from 5.9% to 10.3% mainly driven by the full contribution from
Hirotako Holdings.
YoY, the
bottom line dipped by 11% as the EBITDA margin dropped from 11% to 10%, mainly
due to the credit tightening which affected the sales of Perodua cars as well
as due to higher administrative and marketing expenses incurred.
However,
this was cushioned by the improved earnings from Federal Auto, which recorded a 54.6% increase in
sales mainly due to stronger sales from Volkswagen and Volvo dealerships.
Outlook Mixed.
We expect a
slower 1H12 due to the stricter loan requirements. However, the overall sector sentiment
should improve towards 2H12 as we expect pent-up demand which should see a better
YoY rebound for auto sales.
Change to Forecasts
We are
maintaining our earnings for FY12 and FY13.
Rating
MAINTAIN OUTPERFORM
We believe
in the potential for MBM to grow into a significant autoparts player that would
complement its existing manufacturing division and also offer potential
operational cost efficiency and cost savings to the entire group.
Valuation We are
keeping our target price unchanged at RM3.91 based on an unchanged FY13E PER of
8.0x.
Risks Prolonged
effect from the credit tightening measures.
Source: Kenanga
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