KUALA LUMPUR: CIMB Equities Research said Perodua's dominance has weakened considerably over the past year due to waning demand for its models, especially its top seller Myvi, as buyers waited for the replacement model.
It said on Monday, July 11 this led to a disappointing 10% on-year decline in sales during the January-May period. Its market share has narrowed from 32% in January to May 2010 to only 28% in January to May 2011.
Having released the new Myvi 1.3l, Perodua should be in a better position to defend its turf. Despite the supply disruptions from Japan's earthquake and tsunami in March, Perodua is keeping its 2011 sales target at 195,000 units, in line with our projection. This implies moderate growth of 3%.
'We maintain our earnings forecasts, SOP-based target price of RM8.00 and NEUTRAL recommendation for UMW.
'While the earlier-than-expected launch of the new Myvi is good news, it is unclear if this car will help Perodua recover the market share that it has lost over the past year. We prefer Tan Chong (Outperform) for exposure to the auto industry,' it said.
It said on Monday, July 11 this led to a disappointing 10% on-year decline in sales during the January-May period. Its market share has narrowed from 32% in January to May 2010 to only 28% in January to May 2011.
Having released the new Myvi 1.3l, Perodua should be in a better position to defend its turf. Despite the supply disruptions from Japan's earthquake and tsunami in March, Perodua is keeping its 2011 sales target at 195,000 units, in line with our projection. This implies moderate growth of 3%.
'We maintain our earnings forecasts, SOP-based target price of RM8.00 and NEUTRAL recommendation for UMW.
'While the earlier-than-expected launch of the new Myvi is good news, it is unclear if this car will help Perodua recover the market share that it has lost over the past year. We prefer Tan Chong (Outperform) for exposure to the auto industry,' it said.
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