Stock Name: PROTON
Company Name: PROTON HOLDINGS BHD
Research House: MIDF
Company Name: PROTON HOLDINGS BHD
Research House: MIDF
Proton Holdings Bhd needs to borrow money as its capital expenditure (capex) spending is expected to be about RM800 million-RM1 billion annually, including that for its Group Lotus and domestic research and development, said MIDF Research.
In its research note here today, MIDF said Proton's cash pile has depleted to RM969.3 million at end-December 2010 from RM1.6 billion at end-March 2010, reflecting the channeled cash outflow on the Lotus turnaround plan.
"If we were to assume a manageable debt-to-equity ratio of 0.3 times level, Proton could raise up to RM1.6 billion to fund its capex spending," it added.
It was reported that Proton's 100 per cent-owned Group Lotus will sign a syndicated financing deal with six lenders and it is to be concluded tomorrow.
The six lenders are CIMB Group Holdings Bhd, Malayan Banking Bhd, Oversea-Chinese Banking Corp, Eon Capital Bhd, Exim Bank and Affin Holdings Bhd.
The research house, however, reiterated a "buy" call on Proton's stocks with a target price of RM5.20 based on the price earnings ratio eight times for financial year 2010 forecast earnings and price/net tangible assets ratio of 0.4 times.
It said the stock implies a potential total return of 55.9 per cent including dividend yield of 1.1 per cent, from the current price.
MIDF has forecast Proton's pre-tax profit for the financial year 2012 to be at RM400.7 million on a revenue of RM9.521 billion, while for this year, the forecast is a pre-tax profit of RM299.3 million on revenue of RM8.382 billion. -- Bernama
In its research note here today, MIDF said Proton's cash pile has depleted to RM969.3 million at end-December 2010 from RM1.6 billion at end-March 2010, reflecting the channeled cash outflow on the Lotus turnaround plan.
"If we were to assume a manageable debt-to-equity ratio of 0.3 times level, Proton could raise up to RM1.6 billion to fund its capex spending," it added.
It was reported that Proton's 100 per cent-owned Group Lotus will sign a syndicated financing deal with six lenders and it is to be concluded tomorrow.
The six lenders are CIMB Group Holdings Bhd, Malayan Banking Bhd, Oversea-Chinese Banking Corp, Eon Capital Bhd, Exim Bank and Affin Holdings Bhd.
The research house, however, reiterated a "buy" call on Proton's stocks with a target price of RM5.20 based on the price earnings ratio eight times for financial year 2010 forecast earnings and price/net tangible assets ratio of 0.4 times.
It said the stock implies a potential total return of 55.9 per cent including dividend yield of 1.1 per cent, from the current price.
MIDF has forecast Proton's pre-tax profit for the financial year 2012 to be at RM400.7 million on a revenue of RM9.521 billion, while for this year, the forecast is a pre-tax profit of RM299.3 million on revenue of RM8.382 billion. -- Bernama
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