KUALA LUMPUR: Shares of Axiata Group Bhd advanced to a high of RM4.97 in morning trade on Tuesday, June 14 after its 19%-owned Indian associate Idea reported stronger performance in the FY11 results.
At 11.24am, Axiata was up nine sen to RM4.93 with 8.73 million shares done.
'We retain our earnings forecasts, sum-of-parts based target price of RM6.08 and Outperform call on Axiata. The likely re-rating catalyst is the dividend surprise given the strong free cashflow generation,' it said.
CIMB Research said Idea's FY11 results were 9% and 8% above its and consensus's full-year expectations, respectively. This is due to slightly higher-than-expected revenue and slightly lower-than-expected depreciation.
'The highlights of 4Q were the strong revenue growth, margin improvement and narrowing losses in the newer circles. Idea also guided for a higher capex of Rs40bn for FY3/12, which is 25% higher than FY3/11's level.
'Idea makes up about 5% of Axiata's SOP-based target price and 4% of Axiata's FY11 profit,' it said.
At 11.24am, Axiata was up nine sen to RM4.93 with 8.73 million shares done.
'We retain our earnings forecasts, sum-of-parts based target price of RM6.08 and Outperform call on Axiata. The likely re-rating catalyst is the dividend surprise given the strong free cashflow generation,' it said.
CIMB Research said Idea's FY11 results were 9% and 8% above its and consensus's full-year expectations, respectively. This is due to slightly higher-than-expected revenue and slightly lower-than-expected depreciation.
'The highlights of 4Q were the strong revenue growth, margin improvement and narrowing losses in the newer circles. Idea also guided for a higher capex of Rs40bn for FY3/12, which is 25% higher than FY3/11's level.
'Idea makes up about 5% of Axiata's SOP-based target price and 4% of Axiata's FY11 profit,' it said.
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