KUALA LUMPUR: DRB-Hicom Bhd has a optimistic outlook, premised on sturdy automotive gross sales.
Hong Leong Funding Financial institution (HLIB) Analysis mentioned the group posted a robust turnaround of its core revenue to RM216.6mil within the fourth quarter of 2021 (4Q21) in contrast with RM6.9mil in 4Q20, pushed primarily by the automotive phase.
Following a gathering with DRB-Hicom administration, it famous that Proton Holdings Bhd continued to indicate a promising efficiency on the again of rising demand.
“DRB-Hicom administration targets a continued year-on-year development of 18.6% to 30.8% of gross sales quantity within the monetary 12 months ending Dec 31, 2022 (FY22).
“Equally, Honda Malaysia additionally goals to regain market share with a gross sales goal of 80,000 items in FY22 with engaging new launches,” mentioned HLIB Analysis.
Proton has set a goal of 136,000 to 150,000 items for FY22. It should proceed to ramp up manufacturing to satisfy the excessive order backlog of 60,000 items. New mannequin launches are anticipated to be rescheduled to FY23. It could probably enterprise into the battery electrical car or BEV enterprise by 2027.
In the meantime, Honda is about to regain its market share with a gross sales goal of 80,000 items in FY22.
However, Mitsubishi Motors Malaysia has gained a robust place in FY21, pushed by the brand new Xpander and gross sales are anticipated to maintain into FY22.
HLIB Analysis identified that with the completion of deliveries of the AV8 amphibious multirole armored autos in FY22, DRB-Hicom Protection Applied sciences Sdn Bhd’s contribution is more likely to drop till it is ready to safe a brand new protection contract.
Conversely, Composites Know-how Analysis Malaysia is anticipated to ramp up manufacturing, leveraging on the restoration of the worldwide aviation sector in FY22.
On property improvement, DRB-Hicom highlighted the Automotive Excessive Know-how Valley in Tanjung Malim, which can contain RM32bil in funding.
It additionally consists of township developments and outlays on infrastructure and facilities to show Proton Metropolis into a sensible automotive hub.
As for DRB-Hicom’s 53.5%-owned Pos Malaysia Bhd (PosM), HLIB mentioned it continued to pull on the group’s backside line.
However, PosM posted decrease core losses quarter-on-quarter in 4Q21, with the continued restructuring workouts beneath a brand new administration staff.
“The administration acknowledged PosM was deprived as a result of lack of aggressive experiences. Varied initiatives and digitalisation efforts have been recognized to enhance its competitiveness.
“The administration focused to interrupt even by the top of FY22,” mentioned HLIB Analysis.
HLIB Analysis repeated its “purchase” name on DRB-Hicom with an unchanged goal value of RM2.30 primarily based on a 25% low cost to sum-of-the-parts valuation of RM3.06.
In the meantime, CGS-CIMB Analysis mentioned Proton has entered a memorandum of understanding for a possible collaboration with sensible Vehicle Firm – a premium EV model for distribution of EVs in Malaysia and Thailand.