Tuesday, May 15, 2012

Media Prima: Upgrade to Hold - Getting a better reception

Worst likely over. We expect 1Q12 results to be weak but following quarters to be stronger on recovering adex sentiment. Spot newsprint prices are stabilizing at USD680-USD700/tonne. Media Prima (MPR)'s balance sheet is stronger, allowing it to sustain recurring DPS at 10-11 sen p.a. thus delivering net yields of >4% p.a.. We raise our 2013-2014 earnings estimates by 11-13% and upgrade MPR to Hold from Sell as its share price is now below our unchanged TP of MYR2.34.

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Source: Maybank Research - 15 May 2012

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