TM (HOLD) - 4Q11 Results: Above Expectations

TM (HOLD)

4Q11 Results: Above Expectations

• Although both revenue and EBITDA came in within expectations, FY11 reported core net profit of RM1,002.7m exceeded expectations, accounting for 153% of our full-year forecast and 170% of consensus chiefly due to the recognition of deferred tax income on unutilized tax incentives.
• Declared a final single-tier dividend of 9.8 sen per share lifting the total dividend for FY11 to 19.6 sen per share.
• TM also proposed capital repayment of 30 sen per share via capital reduction.
• We reiterate our HOLD call although our DDM-derived TP has been upgraded by 13.7% to RM5.16 from RM4.54 factoring in the 30 sen per share capital repayment. The stock is likely to continue attract investors due to its defensive nature amidst strong swings in global equity market.

Source: HLIB Research 27 Feb 2012