MBM to see boost in FY19, FY20 earnings from Perodua Aruz
KUALA LUMPUR: MBM Resources Bhd (MBM) is expected to see an increase in its financial year 2019/2020 (FY19/20) earnings from the launch of the latest Perodua Aruz.
Maybank Investment Bank Bhd’s research team (Maybank IB Research) said: “Eyes will be on the booking and delivery of this model, to be revealed frequently in the next few months. Consistent outperformance could present further upside to our earnings forecasts.”
It pointed out that Perodua has already achieved its 2018 sales target of 209,000 units in the first 11 months of 2018 (11M18) and is poised to exceed its 220,000-unit (up seven per cent year-on-year) assumption by three to five per cent.
For this, it expected MBM to report further sequential earnings growth in 4Q18 from already a solid quarter in 3Q18.
“This would help MBM close the year on a new high; beating its 10-year high of RM142 million net profit in 2010. Into 2019, the introduction of the new Perodua Aruz and Toyota Vios and Yaris models should also offer further opportunities for MBM’s alloywheel plant; recall that the new Toyota Rush, launched in October 2018, is a CKD model rolling out of Perodua’s plant. These factors should help MBM climb a step further in 2019 as well,” it opined.
It noted that MBM is the best exposure to Perodua, benefitting as a 22.6 per cent shareholder of Perodua, dealer for Perodua cars, and auto parts supplier.
“Imputing a sales boost from Perodua’s new Aruz model, we raise FY19/20 net profit forecasts by eight and six per cent respectively,” it added.
All in, Maybank IB Research pegged a ‘buy’ call on the stock.