KUALA LUMPUR (May 14): MIDF Research has maintained its Neutral rating Malaysia Building Society Bhd (MBSB) with target price of RM 2.20 and said MBSB’s 1QFY12 net profit was higher year-on-year but dropped on a quarterly basis.
It said in a note on Monday that MBSB’s 1QFY12 net profit of RM79.4 million was higher by 16.3% year-on-year.
It said this was largely due to higher income from Islamic banking operation as a result of expansion of personal loans (personal financing-i).
On a quarter on quarter basis, 1QFY12 net profit was lower by 5.3%.
“It accounted for 22.3% of our forecast. Against consensus numbers, it accounted for only 20.8% of consensus estimates.
“We make no adjustments to our forecast as earnings were within expectation. Our target price is unchanged at RM2.20 based on the average of the valuation derived from a PER of 8.0x on FY12 EPS and PBVR of 1.8x. As the upside potential from the current share price is limited, we maintain Neutral on the stock,” it said.