KUALA LUMPUR: Bursa Malaysia’s first quarter results ended March 31, 2016 were in line with Maybank IB Research’s expectations, supported by stable equities/derivatives trading value/volume.
In a note on Tuesday, the research house maintained its Hold call on the company with a target price of RM9.05 pegged to 23x 2016 PER, in line with peers’ average.
Maybank IB also anticipates a special dividends as unencumbered cash and bank balances grew to RM338mil (63 sen/share) as at end-March 2016, from RM271mil (51 sen/share) as at end Dec-2015.
“After deducting for a final dividend for 2015 of 18 sen/share which was paid on April 18, 2016, the remaining cash balance remains a sizeable RM242mil (45 sen/share), based on our calculation. A special dividend in 2016 is keenly anticipated. In the recent two rounds when Bursa declared special dividends in 2013 and 2014, the amount was 20 sen/share each,” it said.
1Q16 net profit of RM50mil made up 24% of Maybank IB’s and consensus’ full year forecasts. The slight increase in group operating revenue came from derivatives trading revenue and higher listing and issuer services fees.
At equities, trading revenue was flat year-on-year as ADV was down 5% year-on-year to RM2.07bil. Equities/derivatives trading contributed 45%/18% to group operating revenue in 1Q16.
Meanwhile, costs remained well managed with CIR at 47.3%.
Maybank IB said its base case is premised on RM2.1bil/ RM2.2bil equities ADV for 2016/2017, and 15%/12% derivatives growth, taking into consideration a higher base after a strong 18% CAGR over 2010-2015.
“Our net profit growth forecasts for 2016/2017 are in the mid single digit range of 6%. Our DPR forecast is 93%,” it said on Tuesday.
