KUALA LUMPUR (July 19): CIMB Research has upgraded Bursa Malaysia Bhd to a Trading Buy from Neutral at RM6.48 with a target price of RM7.28 and said the KLCI’s rise did not filter through to Bursa’s 1H12 net profit, which edged up by only 3.3% due to lower market velocity.
In a note Thursday, the research house said that at 52-53% of its full-year forecast and consensus numbers, Bursa’s 1H earnings were in line as 4Q earnings are mostly the weakest in the year.
“We continue to value Bursa at a target CY13 P/E of 24x, based on a 20% discount to its 5-year average.
“However, we upgrade the stock from Neutral to Trading Buy on the expectation of an active equity market in 3Q12 which has a few big IPOs lined up. The stock is not an Outperform because of uncertain longer-term prospects for the market,” it said.