Stock Name: PBBANK
Company Name: PUBLIC BANK BHD
Research House: OSK
KUALA LUMPUR: OSK Research says Public Bank is on track to meet its strong profit targets and upgraded it from Neutral to Buy as the bank is set to announce its first quarter earnings on Thursday, April 15. It said on Thursday that after an upward earnings revision, it is raising its target price for Public Bank from RM11.80 to RM13.00. "Our new TP assumes a ROE of 26.0%, a long-term growth of 4.0% and 9.3% cost of equity. The current share price implies a relatively conservative 22% ROE vs management's 3-year target of 30%," it said. OSK Research sees its performance remaining firmly on the uptrend, and largely on course to deliver 2%-3% quarter-on-quarter earnings growth, although the 1Q period is typically a weaker quarter. The relatively strong results are likely to be underpinned by: 1) an uptrend in net interest margins from repricing of mortgages and higher HP rates, 2) quarter-on-quarter growth in wealth management fee income on the back of higher management fees from its unit trust business, 3) a 2%-3% quarter-on-quarter expansion in gross loan base, and 4) continued downtrend in loan loss provisions.
Company Name: PUBLIC BANK BHD
Research House: OSK
KUALA LUMPUR: OSK Research says Public Bank is on track to meet its strong profit targets and upgraded it from Neutral to Buy as the bank is set to announce its first quarter earnings on Thursday, April 15. It said on Thursday that after an upward earnings revision, it is raising its target price for Public Bank from RM11.80 to RM13.00. "Our new TP assumes a ROE of 26.0%, a long-term growth of 4.0% and 9.3% cost of equity. The current share price implies a relatively conservative 22% ROE vs management's 3-year target of 30%," it said. OSK Research sees its performance remaining firmly on the uptrend, and largely on course to deliver 2%-3% quarter-on-quarter earnings growth, although the 1Q period is typically a weaker quarter. The relatively strong results are likely to be underpinned by: 1) an uptrend in net interest margins from repricing of mortgages and higher HP rates, 2) quarter-on-quarter growth in wealth management fee income on the back of higher management fees from its unit trust business, 3) a 2%-3% quarter-on-quarter expansion in gross loan base, and 4) continued downtrend in loan loss provisions.
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