KUALA LUMPUR, Aug 26 — Several research houses remained optimistic on the outlook of automotive giant, DRB-Hicom as its shares emerged as among the most actively traded counter today on profit-taking.
At 12.06pm, DRB-Hicom shares dwindled 12.88 per cent or 38 sen to RM2.57 with 62.34 million shares traded.
The counter hit its 19-year high of RM2.95 last Friday.
RHB Research Institute Sdn Bhd in a research note today said improvements in the automotive division from stronger Proton-derived revenues lifted DRB-Hicom’s earnings and offset a weaker performance of its other segments.
“We remain positive on DRB’s long term prospects. The introduction of the next Geely-based model could be a catalyst,” it said.
DRB-Hicom holds 50.1 per cent in Proton Holdings Bhd, with the remaining 49.9 per cent held by China-based Zhejiang Geely Holding Group Co.
Kenanga Investment Bank in a separate note said Proton is in the midst of finalising a 10-year business road map targeting 30 per cent share of the domestic market and 10 per cent of the regional market via the introduction of new models.
“Specifically, the group is targeting to expand its products portfolio in the small vehicles A and B segments as well as sport utility vehicles (SUV) and multi-purpose vehicles (MPV) segments for their export market,” it said.
It said the completely-knocked-down (CKD) version of Proton first SUV, X70, is poised to be realised in Nov this year while Proton X50 is expected to be launched in the second half of next year.
RHB Research has maintained a “Buy’ rating on DRB-Hicom but revised its target price higher to RM3.35 from RM3.05.
Meanwhile, Kenanga downgraded DRB-Hicom recommendation to “Underperform” from “Market Perform” but revised higher its sum-of-parts target price to RM2.60 from RM2.20 previously. — Bernama