Stock Name: MBMR
Company Name: MBM RESOURCES BHD
Affin Investment Bank upgraded MBM Resources Bhd to "add" from "reduce" previously, with the same target price of RM3.60 a share, after the car components maker tied up with Hino Japan to assemble trucks in Malaysia.
"This vertical expansion denotes potential margin expansion as MBM moves from its existing distribution margins of 2-4 percent to incorporate a 10-15 percent assembler margin composition," the research house said in a note on Monday.
Coupled with good cost discipline and economies of scale, the Hino plant can potentially generate mid-teen margins, Affin added.
MBM's share price has fallen 11.3 percent in the past two weeks, according to Reuters chart. "We believe there may be opportunities to accumulate," Affin said.
By 9.24 am, the counter rose 1.19 percent to RM3.40 per share, as compared with the broader index that remained unchanged. -- Reuters
Company Name: MBM RESOURCES BHD
| Research House: AFFIN | Price Call: BUY | Target Price: 3.60 |
Affin Investment Bank upgraded MBM Resources Bhd to "add" from "reduce" previously, with the same target price of RM3.60 a share, after the car components maker tied up with Hino Japan to assemble trucks in Malaysia.
"This vertical expansion denotes potential margin expansion as MBM moves from its existing distribution margins of 2-4 percent to incorporate a 10-15 percent assembler margin composition," the research house said in a note on Monday.
Coupled with good cost discipline and economies of scale, the Hino plant can potentially generate mid-teen margins, Affin added.
MBM's share price has fallen 11.3 percent in the past two weeks, according to Reuters chart. "We believe there may be opportunities to accumulate," Affin said.
By 9.24 am, the counter rose 1.19 percent to RM3.40 per share, as compared with the broader index that remained unchanged. -- Reuters
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