OSK Research expects Alliance Financial Group Bhd (AFGB) to achieve a high single digit loans growth this year, mainly contributed by its niche Small and Medium Enterprises and consumer banking segments.
"Other income will likely be flat this quarter, due to weaker stockbroking, as its research team is still not in place," OSK Research said in a note today.
The research firm has also adjusted upward its dividend payout ratio for
AFGB's financial year 2012 to 40 per cent from 30 per cent, judging from the
higher dividend of 5.6 sen announced from the 3.3 sen forecasted in the first
quarter 2011.
"We are leaving our forecasts and fair value unchanged at RM3.80, based on
1.65 times financial year 2012 price to book value. "Nonetheless, we are downgrading AFGB to "neutral" as we deem the stock's valuation fair, and the fact that it has appreciated by 18.6 per cent since we initiated coverage with a "buy" call in May," OSK Research said. -- Bernama
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