Maybank IB Research said it anticipates a softer second half due to normalised vehicle sales in Malaysia.
PETALING JAYA: Analysts are upbeat about Bermaz Auto Bhd
’s (BAuto) prospects, which is on track to achieve its sales target for financial year 2024 (FY24).
The group’s core net profit for the first half of FY24 surged 64% year-on-year (y-o-y), despite the end of sales and service tax holiday in March 2023 that beats most analysts and market concensus expectations.
Maybank Investment Bank (Maybank IB) Research said it anticipate a softer second half due to normalised vehicle sales in Malaysia.
BAuto is also on track to achieve its FY24 sales target of 24,000 units, up 12% y-o-y, the research house said in its latest report yesterday. Year to date, it has sold about 12,800 units.
The group’s order backlog has stabilised at around 3,100 units, with Mazda Malaysia’s monthly bookings averaging about 1,500 units, it added.
“We continue to like BAuto for its robust fundamentals, resilient financials with solid net cash and strong free cashflow from asset-light model as well as an appealing over 8% dividend yield.”
In addition, the group’s growth is bolstered by a robust pipeline of new launches and an expanding completely-knocked-down (CKD) mix, ensuring earnings visibility with sustained strong orders surpassing pre-pandemic levels.
Maybank IB Research has maintained its forecast on BAuto, with a “buy” call at a target price (TP) of RM3.
RHB Research, meanwhile, said the group posted another solid quarter in the first half of FY24.
The earnings beat is mainly due to stronger-than-expected sales volumes in both Malaysia and the Philippines, as well higher-than-estimated average selling prices in Malaysia, it added.
Looking ahead, RHB Research expects the cheaper Madza CX30 CKD to help support Mazda sales on top of consistent new model launches.
“BAuto is our sector top pick due to its relative resilience and handsome 11% FY24 forecasts dividend yield,” it noted.
