CIMB zooms in on 52-week high

Written by Yong Min Wei
Wednesday, 24 February 2010 23:47

KUALA LUMPUR: CIMB Group Holdings Bhd today closed 34 sen or 2.69% higher boosted by its best-ever financial performance which saw its net profit more than doubled to RM802.89 million in the fourth quarter ended Dec 31, 2009 (4QFY09) from RM318.6 million a year earlier.

The counter opened at its intra-day low of RM12.84 and climbed to close at a high of RM13 with 13.5 million shares transacted.

CIMB hit an intra-day high of RM13.58 on Jan 12, 2010 before closing at its 52-week high of RM13.52 after trading at a low of RM5.90 on March 12, 2009.

Of the 25 stockbroking firms polled on Bloomberg, 18 have a buy recommendation, six hold and one sell with a 12-month consensus target price of RM14.84. CIMB’s price-to-earning ratio (PER) currently stands at 16.39 times.

CIMB's revenue jumped 47.87% year-on-year (y-o-y) to RM2.78 billion in 4QFY09, bringing the full-year revenue to breach the RM10 billion mark for the first time, at RM10.67 billion. The group's net profit gained 44% to RM2.81 billion in FY09 from RM1.95 billion the year before.

In a report, OSK Research said CIMB's FY09 earnings were within its expectations but 7.5% above consensus, adding that the group "delivered and even exceeded" most of its key performance indicators (KPI) targets with return on equity (ROE) coming in at 15%.

"It remains committed to delivering its longer term FY11 to FY12 ROEs of 18%-20%, while FY10 ROE remains unchanged at 16%," the research house said.

OSK Research said the 4QFY09 results were the group's best-ever quarterly numbers, with non-domestic contributions increasing from 12% in FY08 to 29% in FY09.

"This indicates that the group is making group progress in its regional growth plans which include a bigger regional investment banking market share and transactional banking growth trajectory," it said while maintaining a buy with a target price of RM14.90 on the stock.

ECMLibra Investment Research said while the group's overall year-on-year loans growth continued to exhibit strong numbers as a result of the consolidation of Lippo Bank and Bank Thai with a 21.2% showing, current quarter loans growth had moderated on a "sequential basis" though still commendable.

"This follows on from the strong 3QFY09 numbers, and is a further sign that the worst in loans growth weakening is behind us," it said in a report yesterday.

ECMLibra said CIMB group's strong performance was largely attributed to better contributions from its Indonesian operations on the back of improved net interest margins, phenomenal growth in its treasury and investment income which saw a 54.9% y-o-y increase.

The group was also aided by improved contributions from the asset management division and a turnaround in CIMB-Aviva's operations, the research house said.

"We continue to like the regional and non-interest income growth prospects of the group, and reaffirm our buy call," ECMLibra said while maintaining the target price on CIMB at RM15.25.