Affin Hwang Capital raises target price for Carlsberg to RM39.50

KUALA LUMPUR (Feb 24): Affin Hwang Capital Research has maintained its “Hold” rating on Carlsberg Brewery Malaysia Holdings Bhd (CAB) at RM38.94 with a higher target price (TP)of RM39.50 (from RM28.50) and said CAB’s 2019 results were within house and consensus expectations.

In a note today, the research house said CAB’s core net profit increased 5.4% year-on-year to RM292.1 million, underpinned by continued growth from the group’s mainstream and premium products.

“Nevertheless, we trim our 2020-21E earnings by 7-9%, taking into account potential impact from COVID-19, especially on the group’s on-trade sales.

“We maintain our HOLD rating with a higher TP of RM39.50, after applying a lower discount rate.

“We believe the stock deserves a premium valuation for its solid earnings delivery while yields are still commendable,” it said.