KUALA LUMPUR: CIMB Equities Research is Neutral on MALAYAN BANKING BHD [] as its strong core EPS growth of 46% for FY10 and 15-17% for FY11-12 is largely priced in, given its above-average CY11 P/E of 11.6x vs. the sector's 10.4x.
“We remain NEUTRAL on Maybank We prefer Public Bank for exposure to big-cap Malaysian banks,” it said on Friday, March 26.
The research house said Maybank's proposed dividend reinvestment plan comes as a surprise, but a pleasant one.
CIMB Equities Research said the proposal will benefit shareholders as it gives them the option to reinvest dividends from the group in Maybank shares at up to 10% below market price and without transaction costs.
From Maybank's perspective, there will be minimal earnings dilution as we estimate that the new shares to be issued annually will make up only 2%-3% of the share base and the shares will be issued at a limited discount to the market price.
“We, therefore, maintain our earnings forecasts and target price of RM8.35, still based on a 5% premium over our DDM value,” it said.
About Me
- Nuang
- Ibrahim bin Ramli@Nuang started his career with CIMB Wealth Advisors Berhad as Agency Manager in April, 2008.Previously he was an Internal Auditors and Accounts Executive with Perodua Sales Sdn Bhd since 17 August, 1994. His background:- 1.Certified of Achievement for Master Sales Leadership from Dr Lawrence Walter Ng of President of The Art Of Learning and International Of Learning Without Learning 2.Certified for eXtra Ordinary Performance of Lawrence Walter Award Certificate for One Million Ringgit Club 2007 3. Certified Life & General insurances 4. Conferred with Diploma in Business Studiess & Bachelor of Business Admin(Hons)Finance from UiTM, Terengganu Branch & Shah Alam respectively;
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