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Published: Monday November 19, 2012 MYT 8:49:00 AM

RHB Research maintains Outperform on QL Resources, unch FV RM3.60


KUALA LUMPUR: RHB Research Institute is maintaining its Outperform call on QL Resources with an unchanged fair value of RM3.60 based on target PER of 17 times of its CY13 earnings.

It said on Monday QL is trading at 15.3 times of its CY13 earnings, lower than the average traded PER of 18-20 times range of local large-cap consumer stocks.

RHB Research expects QL to report higher 2QFY03/13 earnings (10% on-yea) driven by: (i) better performance from its marine products manufacturing (MPM); and (ii) increased contribution from its integrated livestock farming (ILF) operations in Indonesia.

"We believe its MPM division would be the key driver of QL's 2QFY03/13 results with improved fish landing. As such, we forecast its MPM division's PBT margin to improve to 14-16% (from 13.7% in 2QFY03/12) in tandem with better fish landing," it said.

RHB Research expected QL Resources' ILF division's performance would be a mixed bag with credible performance from its East Malaysian and Indonesian operations, but weaker contribution from its Peninsula Malaysian operations.

Its POA division would likely report weaker results with lower crude palm oil (CPO) average selling price but partially offset by higher FFB production during the quarter.

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