Stock Name: KGB
Company Name: KELINGTON GROUP BERHAD
Kenanga Research has maintained its "buy" call recommendation on Kelington Group Bhd (KGB) with an unchanged target price of RM1.04 based on its first half 2011 results which came in within expectations.
"The results were within our expectation at 43 per cent of our full-year
forecast on the back of seasonally lower revenue recognition," Kenanga said in a statement today.
"We expect KGB to achieve our RM95 million estimate as the year-to-date
order book stands at RM122 million.
"The results saw some earnings compression in its profit margin from 10 per
cent to seven per cent due to stiff competition in the China and Taiwan
markets," it added.
It said the counter is still undervalued, attributable to its unique
business.
"We have fine tuned our financial year 2011 forecast by 15 per cent as we
tweak our order book assumptions and timing of the recognition, while
introducing our financial year 2012 earnings forecast at RM9.7 million," it
said.
KGB is an integrated provider of ultra high purity gas delivery systems,
managing projects in the wafer, solar and light-emitting diode or liquid
crystal display sectors in Malaysia, China and India. -- Bernama
Company Name: KELINGTON GROUP BERHAD
| Research House: KENANGA | Price Call: BUY | Target Price: 1.04 |
Kenanga Research has maintained its "buy" call recommendation on Kelington Group Bhd (KGB) with an unchanged target price of RM1.04 based on its first half 2011 results which came in within expectations.
"The results were within our expectation at 43 per cent of our full-year
forecast on the back of seasonally lower revenue recognition," Kenanga said in a statement today.
"We expect KGB to achieve our RM95 million estimate as the year-to-date
order book stands at RM122 million.
"The results saw some earnings compression in its profit margin from 10 per
cent to seven per cent due to stiff competition in the China and Taiwan
markets," it added.
It said the counter is still undervalued, attributable to its unique
business.
"We have fine tuned our financial year 2011 forecast by 15 per cent as we
tweak our order book assumptions and timing of the recognition, while
introducing our financial year 2012 earnings forecast at RM9.7 million," it
said.
KGB is an integrated provider of ultra high purity gas delivery systems,
managing projects in the wafer, solar and light-emitting diode or liquid
crystal display sectors in Malaysia, China and India. -- Bernama
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