Backed by a veteran management team, CFO Mr Loo Choo Leong reiterated PACRA's three-pronged approach to tide the downturn at Invest Malaysia 2015.
First, it seeks to maintain its strong financial position.
Second, it plans to stay profitable in a tough operating environment.
Third, it aims to be adroit in promptly seizing opportunities in the recovery cycle.
Given the tough environment, we expect PACRA to break even or incur small losses in 1Q15. We also cut our FY15-17 EPS by 4-6% as we bake in further delays from its newbuild contributions and temper our margin expectations, thus causing our 7.5x CY16 P/E-based target price (1 s.d. below small/mid-cap 5-year mean) to drop. We maintain Add, backed by its growing market share and attractive valuations.
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