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Wednesday, April 15, 2020

Kenanga IB Research raises target price for Kossan to RM6.31
April 15, 2020 08:44 am +08

KUALA LUMPUR (April 15): Kenanga IB Research has maintained its ‘Outperform” rating on Kossan Rubber Industries Bhd at RM5.31 with a higher target price (TP) of RM6.31 (from RM5.90) and said the stage is now set for a solid FY20 after three quarters of anaemic quarterly earnings growth.

In a note today, the research house said that looking ahead, forward earnings growth will be amplified by re-stocking activities ramp-up due to the current COVID-19 pandemic and further boosted by better margins from higher average selling price.

“TP raised from RM5.90 to RM6.30 based on 28.5x FY21E EPS (at +1.5SD above 5-year historical forward mean).

“We roll forward our valuation from FY20E to FY21E. Reiterate Outperform,” it said.

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