Stock Name: MAS
Company Name: MALAYSIAN AIRLINE SYSTEM BHD
Research House: CIMB
KUALA LUMPUR: CIMB Research has maintained its Outperform rating on MALAYSIAN AIRLINE SYSTEM BHD [] (MAS) with a target price of RM2.30 based on an unchanged core P/E multiple of 7 times due to its continued long-term confidence in MAS's fleet renewal.
The research house said on Friday, April 15 that during the welcoming ceremony for MAS's first A330-300 delivery, the airline revealed measures to cope with higher fuel prices, including raising fuel surcharges to cover some 50% of the cost increase since the start of the year and scaling back its 2011 capacity growth from 10% to only 4%.
The fleet renewal programme was also continuing with the delivery of 12 new-generation planes by year-end, it said.
'Unfortunately, these measures will not come fast enough to prevent a set of weak 1H results due to cost pressures and the impact of Japan's earthquake on demand.
'Potential re-rating catalysts include continuing reforms to boost structural profitability. Our earnings forecasts are unchanged,' it said.
Company Name: MALAYSIAN AIRLINE SYSTEM BHD
Research House: CIMB
KUALA LUMPUR: CIMB Research has maintained its Outperform rating on MALAYSIAN AIRLINE SYSTEM BHD [] (MAS) with a target price of RM2.30 based on an unchanged core P/E multiple of 7 times due to its continued long-term confidence in MAS's fleet renewal.
The research house said on Friday, April 15 that during the welcoming ceremony for MAS's first A330-300 delivery, the airline revealed measures to cope with higher fuel prices, including raising fuel surcharges to cover some 50% of the cost increase since the start of the year and scaling back its 2011 capacity growth from 10% to only 4%.
The fleet renewal programme was also continuing with the delivery of 12 new-generation planes by year-end, it said.
'Unfortunately, these measures will not come fast enough to prevent a set of weak 1H results due to cost pressures and the impact of Japan's earthquake on demand.
'Potential re-rating catalysts include continuing reforms to boost structural profitability. Our earnings forecasts are unchanged,' it said.
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