Stock Name: AIRPORT
Company Name: MALAYSIA AIRPORT HOLDINGS BHD
Research House: OSK
Company Name: MALAYSIA AIRPORT HOLDINGS BHD
Research House: OSK
OSK Research Sdn Bhd has maintained its earnings and "buy" recommendation on Malaysia Airports Holdings Bhd (MAHB), with a RM8.47 target price, based on the discounted cash flow (DCF) valuations of all its Malaysia-based airports of RM7.97.
"MAHB remains our defensive pick in the aviation space in view of the significant upside and its decent dividend yield of three per cent," OSK said in its research note today.
The country's airport operator will continue to see fairly encouraging air travel momentum, although growth is expected to moderate to 8.6 per cent and 5.6 per cent for this year and next year respectively, it added.
"Our earnings growth projections for 2011 and 2012 are 17.5 per cent and 0.3 per cent respectively, whereby the double digit growth in 2011 earnings will be driven by higher commercial sales and cost-cutting to boost margins," OSK explained.
It also said that in profit terms, MAHB’s commercial segment continues to be a key revenue and margin driver, although earnings projections are somewhat conservative, said the research house.
It noted that MAHB continues to heavily bank on the potential growth in commercial sales over the next few years, with management targeting passenger spending per pax to grow from RM36 currently to RM50 by 2014.
"By which time, commercial spending is expected to make up 50 per cent of MAHB’s terminal revenue," it highlighted. - BERNAMA
"MAHB remains our defensive pick in the aviation space in view of the significant upside and its decent dividend yield of three per cent," OSK said in its research note today.
The country's airport operator will continue to see fairly encouraging air travel momentum, although growth is expected to moderate to 8.6 per cent and 5.6 per cent for this year and next year respectively, it added.
"Our earnings growth projections for 2011 and 2012 are 17.5 per cent and 0.3 per cent respectively, whereby the double digit growth in 2011 earnings will be driven by higher commercial sales and cost-cutting to boost margins," OSK explained.
It also said that in profit terms, MAHB’s commercial segment continues to be a key revenue and margin driver, although earnings projections are somewhat conservative, said the research house.
It noted that MAHB continues to heavily bank on the potential growth in commercial sales over the next few years, with management targeting passenger spending per pax to grow from RM36 currently to RM50 by 2014.
"By which time, commercial spending is expected to make up 50 per cent of MAHB’s terminal revenue," it highlighted. - BERNAMA
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