KUALA LUMPUR: ''Padiberas Nasional Bhd (Bernas) shares advanced on Thursday, Aug 25 after Maybank IB Research initiated coverage on the stock with a Buy rating with a target price of RM3.90.
At 9.50am, Bernas added 10 sen to RM2.90 with 32,000 shares traded.
The research house said in a note that Bernas was Malaysia's custodian of rice and paddy with a 50% market share, adding that its business model was simple yet low risk: it buys paddy from local farmers, mills it and distributes it across the country.
'The deficit of local supply is supplemented by imports - of which Bernas has a monopoly. Profit growth are secured due to Malaysia's insatiable demand for rice and cost reductions from on-going plant modernisation.
'We initiate with a BUY, with a target price of RM3.90/share based on 8.1x 2011 PER,' it said.
At 9.50am, Bernas added 10 sen to RM2.90 with 32,000 shares traded.
The research house said in a note that Bernas was Malaysia's custodian of rice and paddy with a 50% market share, adding that its business model was simple yet low risk: it buys paddy from local farmers, mills it and distributes it across the country.
'The deficit of local supply is supplemented by imports - of which Bernas has a monopoly. Profit growth are secured due to Malaysia's insatiable demand for rice and cost reductions from on-going plant modernisation.
'We initiate with a BUY, with a target price of RM3.90/share based on 8.1x 2011 PER,' it said.
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