Stock Name: TMCLIFE
Company Name: TMC LIFE SCIENCES BHD
Research House: OSK
KUALA LUMPUR: OSK Research is maintaining its Neutral call on TMC Life Sciences at 34 sen and maintains the RM5.8 million net profit forecast for FY10. In terms of recommendation, the research house said on Wednesday, March 24 it was still Neutral on the stock because of its unattractive FY10 PER. "Management reiterates that TMC will continue to pay dividends despite the Tropicana Medical Centre is going through a gestation period," it said. OSK Research said the management gave a detailed presentation on TMC's traditional fertility business and the new Tropicana Medical Center. Key highlight was that the new medical centre is expected to turn around this year. All the key operating statistics of the Tropicana Medical Centre such as number of admissions, average revenue / in-patient, number of new beds opened and number of in-patients have improved over the last three quarters. As a result, TMC had recorded positive EBITDA and reduced net losses. The research house said TMC had undertaken various initiatives to create greater awareness for the new hospital. Majority of its clientele thus far came from the surrounding communities and the company will continue to promote its services. In FY09, TMC derived 59% of its revenue from fertility services and another 29% from hospital services. Two other services namely the wellness program and the stem cell which contributed 9% and 3% respectively to FY09 revenue are expected to remain relatively stable in FY10. For the wellness program, marketing agency which has committed to bring in RM42 million sales over the 5 years period would provide stable revenue to TMC though not very significant. As for the stem cell business, because of pricing competition and limited stem cell therapies, OSK Research says it is not expecting this division to contribute significantly to TMC at least for the next two years.
Company Name: TMC LIFE SCIENCES BHD
Research House: OSK
KUALA LUMPUR: OSK Research is maintaining its Neutral call on TMC Life Sciences at 34 sen and maintains the RM5.8 million net profit forecast for FY10. In terms of recommendation, the research house said on Wednesday, March 24 it was still Neutral on the stock because of its unattractive FY10 PER. "Management reiterates that TMC will continue to pay dividends despite the Tropicana Medical Centre is going through a gestation period," it said. OSK Research said the management gave a detailed presentation on TMC's traditional fertility business and the new Tropicana Medical Center. Key highlight was that the new medical centre is expected to turn around this year. All the key operating statistics of the Tropicana Medical Centre such as number of admissions, average revenue / in-patient, number of new beds opened and number of in-patients have improved over the last three quarters. As a result, TMC had recorded positive EBITDA and reduced net losses. The research house said TMC had undertaken various initiatives to create greater awareness for the new hospital. Majority of its clientele thus far came from the surrounding communities and the company will continue to promote its services. In FY09, TMC derived 59% of its revenue from fertility services and another 29% from hospital services. Two other services namely the wellness program and the stem cell which contributed 9% and 3% respectively to FY09 revenue are expected to remain relatively stable in FY10. For the wellness program, marketing agency which has committed to bring in RM42 million sales over the 5 years period would provide stable revenue to TMC though not very significant. As for the stem cell business, because of pricing competition and limited stem cell therapies, OSK Research says it is not expecting this division to contribute significantly to TMC at least for the next two years.
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