KUALA LUMPUR: MIDF Research trimmed its FY19F/FY20 earnings estimates by 22%/-20% for Superlon Holdings Bhd
as the group will not be able to fully pass on the increase in raw material prices, especially to its price sensitive customers.
As a result, the research house said its estimates for FY19 and FY20 net profit is cut to RM15.0mil and RM18.3mil respectively.
It maintained its Neutral stance on the counter with an adjusted target price of RM1.23 from RM1.58 previously.
It said the lower target price was a result of lower earnings per share estimates for FY19.
“We are cautious of the heightened competition globally while raw material prices remain elevated,” it said.
However, it noted that the group’s Vietnam factory is on track for production by end FY19, while it is still sitting on a net cash of RM9.2mil.
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