Analysts reaffirm ‘buy’ on MBM after Bezza launch
KUCHING: Analysts have reaffirmed ‘ buy’ on MBM Resources Bhd (MBM) following Perodua’s launch of the 2020 Bezza facelift.
According to the research arm of MIDF Amanah Investment Bank Bhd ( MIDF Research), the facelift Bezza is packing up on features and is the most affordable sedan in Malaysia to be equipped with auto emergency braking (AEB).
“This should help Perodua keep up with Proton which has been doing the same in the past year for it’s A or B segment models,” MIDF Research said.
“The Bezza is one of Perodua’s key volume drivers, generating approximately 4000 unit sales per month and accounting for an estimated 20 per cent of Perodua’s total industry volume ( TIV).
“Perodua management’s target sales of 4,000 units per month for the facelift Bezza is in-line with historical sales.”
MIDF Research noted that other than the facelift Bezza, Perodua is scheduled to introduce its B- segment sports utility vehicle ( SUV), possibly in the second half of 2020 (2H20), positioned below the Aruz which is priced at RM70,000 to RM80,000.
“The Alza is also long overdue for a replacement, first launched in 2009 with its last facelift in 2018.”
The research arm’s forecast for a 1.6 per cent year on year (y- o-y) growth in Perodua’s financial year 2020 ( FY20F) TIV at this juncture is conservative, it noted.
As such, MIDF Research reaffirmed its ‘ buy’ on MBM at an unchanged target price of RM4.55 per share.
“At just seven-fold FY20F earnings coupled with an attractive 6.7 per cent yield, MBM remains a cheap proxy to Perodua’s volume expansion and the spillover on its parts manufacturing and Perodua dealership units.”