Friday, November 25, 2011

CIMB Research downgrades DiGi to underperform

KUALA LUMPUR (Nov 25): CIMB Equities Research said DiGi's share price has bolted ahead of its fundamentals, after a 20% surge in its share price, which it attributed to its stock split.

It said on Friday that DiGi's fundamentals remain unchanged. Its P/E and EV/EBITDA valuations are now among the highest in the sector.

'Given its sky-high valuations, we downgrade it to Underperform from Outperform even though our DCF-based target price rises with our rollover to end-12.

'We also trim EPS for an assumed 8.9 sen increase in FY12 DPS paid out from its share premium account. Switch to TM and Axiata,' it said.

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