CIMB Research keeps Daibochi (8125.KU) as Outperform with unchanged MYR4.60 Target

CIMB Research keeps Daibochi (8125.KU) as Outperform with unchanged MYR4.60 target based on 12X CY11 P/E target, which factors in a 20% discount to our 15x target PE for the market. "Factors that could catalyse the stock include further margin expansion over the next few quarters, contracts from major non-F&B companies and, investors' increasing awareness of its attractive dividend yield of 7%, says analyst Nigel Foo. "Daibochi has the potential to pay higher dividends if the non-food and beverage business takes off in a major way over the next few quarters," says Foo; adds company's balance sheet strong, at only 0.1X net gearing as at end-2009. Stock last +2.3% at MYR3.54