HwangDBS Vickers Research initiated coverage of Pos Malaysia and Services Holdings Bhd with a "buy" rating and a target price of RM4.60, citing its attractive valuations.
"Valuation for Pos is cheap, based on its forward financial year ending March 31, 2014 (FY14) price-to-earnings ratio (PER) of 9 times (versus industry average of 11 times) while ex-cash FY14 PE stood at 5 times," the research house said in a note on Friday.
HwangDBS said Pos Malaysia has more room to reinvent and improve itself now with DRB-Hicom Bhd as its major shareholder, offering new services ranging from pawnbroking to shared banking services. DRB-HICOM holds 32.2 percent stake in Pos Malaysia.
By 10:19 am, shares of the company were up 1.72 percent at RM2.95 per share, outperforming the Malaysia's benchmark stock index's 0.03 percent rise. -- Reuters
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