Initiate Coverage

21 July 2021

MR D.I.Y. OUTPERFORM
Price : RM3.48
Serving the Remote Target Price : RM4.10
By Ahmad Ramzani Ramli l ahmadramzani@kenanga.com.my
We initiate coverage on MR D.I.Y with an OUTPERFORM rating and TP Share Price Performance
of RM4.10. MR D.I.Y is Malaysia’s largest home improvement retailer
with a market share c.29% with 788 stores covering the whole of
Malaysia and Brunei. We are positive on the Group for: (i) robust 4.00

growth, driven by burgeoning market demand as urbanisation spread 3.50

and stores expansion, and (ii) strong GP margins (above 40%). We
3.00
estimate FY21E/FY22E net profits of RM451m/RM707m (+34%/+56%)
with a 3-year CAGR (2019-22) of 31%. Our TP is based on a 36x PER of 2.50

FY22E EPS of 11.2 sen. 2.00

Sustainable business model, despite the ongoing pandemic, MR 1.50

D.I.Y. saw +13% QoQ/+63% YoY top-line growth, underpinned by its

large network all over Malaysia and Brunei – 783 stores (+25% YoY).
Only 33% of its stores are located in the Central Region followed by the KLCI 1,519.97
YTD KLCI chg -6.6%
Southern, Northern and East Coast Region at 21%, 18% and 14%,
YTD stock price chg 11.5%
respectively. The home improvement retail space in Malaysia is
expected to chalk a CAGR of 10.2% (FY19-24) and is still largely Stock Information
under-penetrated, thus offering the Group the opportunity to open new Shariah Compliant Yes
stores and new catchment areas – as such it is targeting to open 175 Bloomberg Ticker MRDIY MK Equity
stores each year for FY21/FY22 (FY20: 141 stores opened). This Market Cap (RM m) 21,842.6
ambitious target includes the opening of 50 MR DOLLAR stores – Shares Outstanding 6,276.6
offering popular everyday essentials at RM2 and RM5 - and 25 stores 52-week range (H) 4.38
for MR TOY – supplying value-for-money toys for the under-served. 52-week range (L) 1.50
We expect MR D.I.Y. to achieve a net cash position in 2021, 3-mth avg daily vol: 7,331,177
comfortable enough to comply with its 40% dividend payout policy and Free Float 27%
Beta N/A
fund further expansion in FY22.
Robust margins. Gross Margins have been stable and robust, with Major Shareholders
gross margin averaging 43% (2017-2020) despite having >72% of its Bee Family Ltd 51.0%
products sourced from China which economies of scale have kept Hyptis 15.3%
imported products’ costs low and helped further by a favourable Ringgit Platinum Alphabet Sdn Bhd 6.9%
against the Renminbi. The introduction of MR TOY is likely to sustain
Summary Earnings Table
margins further Its product mix are reviewed every quarter and
FY Dec (RM m) 2020A 2021E 2022E
changes are made if needed to maintain these robust margins.
Turnover 2,559 3,260 4,486
Initiate OUTPERFORM rating with a Target Price of RM4.10 based EBITDA 697 869 1,263
on FY22E PER of 36x. We believe it deserves a high premium as: (i) EBIT 525 652 998
MR D.I.Y.’s 3-year average (FY19-FY22E) net profit CAGR of 31% is PBT 458 613 959
Net Profit 337 451 707
higher against its regional peer average of 10%, (ii) MR D.I.Y. is
Core PATAMI 337 451 707
operating in an under-penetrated home improvement retail market, and Consensus (NP) 0.0 525 641
iii) it is the largest home improvement retailer in Malaysia with no major Earnings Revision - - -
domestic competitor in sight. We are positive on MR D.I.Y. for its: (i) Core EPS (sen) 5.4 7.2 11.2
robust growth potential, driven by both higher market demand for its Core EPS growth (%) -100.0% 33.9% 56.3%
products and stores expansion, (ii) strong GP margins (above 40%) NDPS (sen) 0.8 2.9 4.6
with the absence of near-and long-term margin volatility thanks to its BVPS (RM) 0.14 0.19 0.25
supply source, China’s massive economies of scale, (iii) robust balance PER (x) 64.8 48.4 31.0
sheet, providing it ample cash for expansion, and (iv) net cash position PBV (x) 24.9 18.7 13.7
Net Gearing (x) 0.2 (0.0) (0.2)
ahead, allowing MR D.I.Y. to deliver sustainable dividends.
Net Div. Yield (%) 0.2% 0.8% 1.3%
Risks to our call include: (i) a dominant import source, (ii) foreign
labour issue, (iii) unfavourable Ringgit and (iv) prolonged lockdown

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Investment merits
Network all over Malaysia. MR D.I.Y Group Berhad (MR DIY.) is Malaysia’s largest home improvement retailer with an
estimated market share of 29% (in 2019). Its top-line 4-year CAGR (201-2020) is 28%, largely due to its affordable products
catering to price-sensitive customers holding true to its motto – “ÁLWAYS LOW PRICES”. Despite the pandemic, top-line was
still robust with FY20 ending at +12% (vs FY19: +28%). It began FY21 impressively with a surging top-line at +13% QoQ/+63%
YoY. The robust growth is underpinned by its network – 783 stores servicing all the way into the remotest part of Malaysia-
from Arau, Pauh, Tumpat in Northern Malaysia to Balung, Tawau in Sabah in the East. 33% of its stores located in the Central
Region, followed by the Southern Region (21%), Northern Region at 18%, East Coast at 14% with East Malaysia (including
Brunei) at 15%. As compared to other matured markets, the under-penetrated supply of retail space and retail sales of home
improvement offers opportunity to open new stores and serve new catchment areas in low penetration states such as Kedah,
Perlis, Kelantan and Sabah.
Relentless expansion. Since opening its 100th store in 2014, store expansion has been impressive. As at 1QFY21, MR DIY
has around 783 stores with locations all over Malaysia and 5 in Brunei. It ended with 734 stores for FY20 and added 54
(1QFY21) more while at the same time closed 8 outlets due to poor location/traffic. In the last three years, average stores
opening were at least 127 stores or CAGR of 28%. Despite the pandemic 141 stores opened in FY20 (vs FY19: 126). The
Malaysian home improvement retail sector is forecasted to grow at a CAGR of 10.2% for FY19-24 (Frost & Sullivan) and
management is set to continue it expansionary phase, targeting 175 stores each for the next two years (2021-22). The
expansion is largely due to its pursuing new store concepts to cater to the unmet needs of different customer segments. In
2019, it introduced MR TOY; supplying value-for-money toys - a non-branded segment for the under-served. MR DOLLAR
followed a year later – offering popular everyday essentials at RM2 and RM5. MR Dollar is modelled on dollar stores popular in
Japan and the United States. Of the 175 stores per year, 100 stores will be MR DIY, 50 will be MR DOLLAR and the remainder
will be MR TOY.
Robust margins. MR DIYs gross margins have been impressive; averaging (for 2017-2020) at 43%. Source of products are
mainly from China making up 72% of total with the remainder sourced locally and the ASEAN region. The Ringgit were
favourable against the Renminbi during this 2017-2020 period. MR TOY’s products are sourced mainly from China and gross
margins are better at 40-50%. Products sourced from China have better margins due cost advantages from economies of scale.
Another plus factor in keeping margins higher is due to its product mix. New products are introduced every quarter and all
products are reviewed quarterly with changes made in terms of location, positioning and prices (if needed). Margins are similar
whether the outlet is in a mall or a stand-alone - rentals in malls are expensive but offset by higher footfalls while the reverse is
true for stand-alone stores.
Robust Balance Sheet ahead. For FY20A, gearing stood at 0.2x (FY19: 1.42x). The Business is cash generative by itself –
historically Free Cash Flow cash averages c. RM314mwith working capital needs in the tune of <RM50m. Internally generated
cash are adequate enough to fund its store expansion. Note that capex for FY20 was at RM122m with the expansion of 141
stores or RM0.86m/store. As such capex for FY21E is expected to be in the tune of RM150m. We believe Mr DIY will have a net
cash position from FY21E onwards, comfortable enough to comply with its 40% dividend payout policy and further expansion in
FY22E.
Financial performance
Historical Earnings. Mr DIY has been growing robustly with a 3-year CAGR of +28%/+17% for its topline/bottomline. The wide
variance between its topline/bottomline is attributed to higher opex coming from its expansion plans. Its EBIT margin which was
at 24% in FY17 saw a 4ppts declined by FY2020 given the capital expansion. Gross margins were largely stable but saw a
140bps compression to 43% (in the same period) due to i) expansion into East Malaysia and ii) SST costs. Due to better
product mix average value/transaction (or basket size) were much more positive at +18% YoY to RM26 in FY20 despite
average sales/store/day falling 8% to RM10,530. This led to average transaction for FY20 falling 5% to RM96m. Average
transaction/store/day fell 22% to 402 for FY20, not surprisingly given the prevailing restrictive movements in 2020. Despite the
challenges of 2020, 3-Year CAGR (2017-2020) were positive for both average value/transaction and average transaction/year
at 8% and 18% respectively.
Historical Value
2017 2018 2019 2020
Average Value/Transaction (RM) 21 21.8 22.2 26.2
Average Sales/Store/Day (RM) 11,341 11,731 11,463 10,530
Average transactions/month (Mil) 4.861 6.744 8.443 8.00
Average X transactions/Year (Mil) 58.332 80.928 101.316 96.000
Average X transactions/store/day 537 541 513 402
Average X transactions/store/Year 193,320 194,760 184,680 144,687
Source: Company, Kenanga Research

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Historical Earnings

Source: Company, Kenanga Research

Moving forward, we are anticipating a topline of RM3.2b/RM4.5b/RM5.2b for FY21E/FY22E/FY23E or a +27%/+39%/+15%
growth. We believe its doable given the i) the targeted outlets expansion ii) the unpenetrated market in the North and East
Coast Region as well as in East Malaysia and iii) the largest home improvement retailer in Malaysia and the only one offering a
variety of products at affordable prices. We expect a core net profit growth of +33%/+59% and +13% for FY23E premised on a
constant GP and EBITDA margins of 43% and 28% respectively with EBIT to the tune of 21%
Valuation
Initiate coverage with an OUTPERFORM rating and TP of RM4.10. We derived the target price by applying a PER of 36x on
FY22E earnings. Our target PER multiple implies a 50% premium to its FY22E regional peers’ average of 24x on the basis of:
(i) MR DIYs higher 3-year average (FY19-FY22E) net profit CAGR of 31% against its regional peers’ average of 10%, ii) MR
DIY business model of low prices but better gross margins and (iii) MR DIY is operating in an under-penetrated home
improvement retail market - according to Frost & Sullivan, the home improvement retail sector in Malaysia is under-penetrated,
with approximately 216 home improvement stores per million capita (2019) vs Thailand, Japan and Australia at 231, 236 and
405, respectively. We are positive on MR D.I.Y. for its: (i) robust growth, driven by both higher demand for its products and store
expansion, (ii) strong GP margins (above 40%) with the absence of near-and long-term margin volatility thanks to China’s
supply chains’ economies of scale, (iii) robust balance sheet, providing it ample cash for expansion, and (iv) net cash position
allowing MR D.I.Y. to deliver sustainable dividends.
Regional Peers
We base our basket of regional peers on: (i) ACE Hardware (Indonesia), (ii) All Home (Philippines), (iii) Home Product
(Thailand), (iv) Siam Global (Thailand), and (v) Wilcon Depot (Philippines).
Comparison of Regional Peer Financials
Net (Cash) /
FYE Revenue (RMm) Net Profit (RMm) Gross Margins % ROE %
Debt

Company 2018 2019 2020 2018 2019 2020 2018 2019 2020 2020 2020
MR D.I.Y. Dec 1,771 2,276 2,559 308 318 337 44 42 43 173 55
Ace Hardware
Dec 2,052 2,385 2,139 271 301 212 48 48 49 (641) 15
(INDO)
AllHome
Dec N.a 965 1,052 N.a 84 84 N.a 30 32 404 8
(PHP)
Home Product
Dec 7,691 8,415 7,837 696 825 699 28 26 25 807 24
(THAI)
Siam Global
Dec 3,172 3,748 3,614 251 282 267 21 21 24 1,644 12
(THAI)
Wilcon Depot
Dec 1,613 1,958 1,917 141 170 123 31 33 34 (386) 10
(PHP)
Source: Bloomberg, Kenanga Research

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Key Risks include:

One dominant import source. China is MR D.I.Y.’s primary import source contributing 72% of total, thus the Group might be
sensitive to changes in domestic Chinese export policy. Primary attraction in engaging China is their value proposition of their products
due to their massive economies of scale. MR D.I.Y. is also engaged with a Chinese freight management service provider to
consolidate and coordinate import purchases from end-suppliers in China. While there is only one dominant import country, the Group
is engaged in with almost 800 suppliers (locally and abroad) with its largest end-supplier accounting for only <5% of total purchases.
Foreign labour risks. Across the manufacturing industry, firms have been facing labour shortages due to: (i) government
policies aimed at reducing reliance on foreign workers, (ii) lack of foreign workers due to the closure of borders, and (iii) rising
pandemic among foreign workers. From MR D.I.Y.’s perspective, 13% of its workers are foreigners (or 1,530 workers) and most
are located at its warehouses. Although there are plans to reduce the dependency on foreign labour by making the warehouses
more automated, we understand that certain workloads require manual labour in which foreign workers are more suitable.
Treatment of foreign workers are on par with locals; incentives, wages/bonuses equal to domestic workers.
Foreign currency risk. As source material are significantly imported, the Group are exposed to foreign currency fluctuations
particularly the Ringgit against the Renminbi. In the past, there has been no significant margin pressure to the Group as Ringgit
were favourable against the Renminbi. As such historically the Group does not enter hedging transactions to reduce its
exposure to currency risk. With the Ringgit looking less favourable presently, we understand that freight costs are slowly eating
into margins and the Group might be forced to pass these rising costs to its customers.
MCO. The prolonged travel/business restrictions will impact retail footfalls and hence transaction volumes. Although Mr DIY
remained open its non-essential segments are cordoned in the FMCO.

Company background and business overview

The Company was incorporated under the Companies Act, 1965 on 12 October 2010 as a limited under the name of MR D.I.Y.
Sdn Bhd. On 1 June 2016, it was renamed MR D.I.Y. Group (M) Bhd. It became a public company on 4 June 2019 and
assumed the name of MR D.I.Y. Group (M) Berhad. The principal activity of the company is investment holding whilst its
subsidiaries are principally involved in the retail of home improvement products and mass merchandise in Malaysia and Brunei.
As at end of March 2021 it has 783 stores in Malaysia and 5 stores in Brunei. Its operations are only located in Malaysia and
Brunei. It received the "Brand Leadership in Retail- Home Improvement 2018 - 2019 from Brand Laureate followed by the World
Branding Awards in 2018 and 2019 for "Winner in Retail - Home Improvement Category (National Tier)"

Corporate Structure

Source: Company

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Typically, MR D.I.Y. stores are located in convenient locations that are accessible to customers such as alongside roads, in
shopping malls, business and shopping districts. Stores typically operate seven days a week to maximize convenience for
customers. MR D.I.Y. offers a wide range of attractive but price-to-quality value propositions; hence, carrying an extensive
variety of products. Most of the products consist of hardware, household and furnishing, electrical, stationery and equipment
products. It is flexible to change its products offering in tune to festivities or as in recent case, the pandemic. It introduced Covid-
19 essentials which now makes up 2% of its sales. Stores are operated on a two formats; (i) retail mall-based stores – typically
located on higher floors of shopping malls or within/adjacent to premises of supermarkets and hypermarkets - and (ii) stand-
alone shop-front stores – typically at street level.
A typical MR D.I.Y. store size is 10,000 sq ft or 18,000 SKU on average. Stores are leased with a typical lease of 12 to 15 years
in tranches of 3 years. Stores in malls are still popular but stores located in a rural area are gaining more traction than urban
ones.
Stores: Type of Stores Stores: Location as of March 2021

Source: Company

MR DIY. is committed to ensuring the continued relevance and quality of its products. All proposed new products are evaluated
based on market trends, product quality, price, and manufacturers’ feedback on their best-selling products. In addition, the
Group conducts quarterly product reviews, assessing product sales volumes, inventory turnover and sales margins to ascertain
each product’s optimal shelf space. The Group sells third-party branded products including reputable brands such as Phillips,
Dunlop, Faber-Castell, WD-40 and Energizer, but also works with global manufacturers to create white label products that carry
the ‘MR D.I.Y.’ or ‘MR D.I.Y. Premium’ brands. While most of the products sold at the Group’s stores are predominantly third-
party, MR D.I.Y.’s white label products offer customers a higher price-to-quality value proposition compared to third-party
branded products. This has been well-received by customers, reflected in the sales growth of white label products from 15.3%
in 2019 to 17.2% in 2020. Third-party branded products made up the respective balances. Going forward, the Group will
continue to evaluate the introduction of more such white label products.
The Group’s procurement primarily consists of product inventory for its own stores, mainly sourced from end-suppliers,
manufacturers and distributors in Malaysia and other countries. Imported products decreased from 73.2% in 2019 to 71.6% in
2020, while products sourced locally increased from 26.8% in 2019 to 28.4% in 2020. Imported products will continue to be an
important aspect of the Group’s merchandising strategy. Products are sourced from end-suppliers comprising manufactures and
distributors from China (73%) and Malaysia 26%. The remainder are from Thailand and Indonesia or c.800 suppliers in total. Its
largest end-supplier accounts for <5% of total purchases. To optimise per unit logistics, MR DIY. typically consolidate import
purchases from end-suppliers in China into full container loads before shipping.
There were moderate shifts in the merchandising sales mix in the year under review, mainly due to the impact of the pandemic.
As an example, there was an increase in demand for household and furnishing items during the prolonged movement restriction
period. The Group introduced F&B products at 89 MR DIY stores in December 2019, to positive response from customers. This
was expanded to 349 stores by the end of 2020, including the 14 MR DOLLAR stores that opened in 2020.

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Product Offering: Types Product Offering: Brands and Source

Source: Company

MR DIY’s operations are supported by centrally inventory and distribution systems, which help to ensure that stores are
sufficiently stocked to meet customers' demands. The Group operates a distribution centre consisting of a cluster of 13 closely
located facilities totalling over 700,000 sq ft situated in Balakong, Seri Kembangan, and Port Klang, from which all products are
distributed to stores across Peninsular Malaysia via a fleet of 113 trucks, and to stores across East Malaysia and Brunei through
third party freight service providers. Third party freight services are also used to distribute products to certain stores in
Peninsular that are inaccessible to the Group’s trucks. The distribution centre typically operates 24/7, 6-day/week to achieve a
3-day turnaround.
In March 2021, MR D.I.Y. launched a 65,000 sq ft robotic warehouse in Seri Kembangan, equipped with 23 programable robots
which are able to fulfil online purchases faster than a manual system. This is expected to increase operational efficiency by
200%. E-commerce will be an increasingly important platform for the Group going forward, which is leveraging on technology to
unlock greater benefits from this channel, as it aligns to the Fourth Industrial Revolution (“IR 4.0”).

MR D.I.Y. Robotic Wharehouse

Source: Company

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Management Profile
MR DIY. founder-led key senior management has grown the business since its first store opened in 2005 by successfully
implementing sound business model, store roll-out strategy and developing relationships with manufacturers, distributors,
trading houses and third-party service providers. He key senior management team has an average of 14 years of relevant retail
experience. Among the key senior management are:
Tan Yu Yeh. Executive Vice Chairman since 2020. A Universiti of Malaya graduate, he began his career with Inter-Pacific
Securities and since 2005 has supported the Group as a director, shareholder and adviser. Founder of the Business, he opened
the first Mr DIY store in 2005 at Jalan Tuanku Abdul Rahman.
Ong Chu Jin is the Chief Executive Officer of the Group and was appointed in 2019. A member of both the Institute of Chartered
Accountants in England & Wales and the Malaysian Institute of Accountants, he also holds an MBA from the Judge Business school
from the University of Cambridge. He started as an auditor with Kingston Smith, London before moving to KPMG Malaysia. He held
various senior positions in the CIMB Group, one of which was Senior Managing Director, and prior to moving to MR D.I.Y. was
Managing Director of Creador Sdn Bhd and its representative for its other retail sector portfolio companies.
Lim Chen Wee is the Senior Vice-President, Finance and joined the Group in 2017 as the Financial Controller. She holds a Bachelor
of Accountancy from Universiti Putra Malaysia and is a member of Malaysian Institute of Public Accountants and Malaysian Institute of
Accountants. Prior to joining MR D.I.Y., she was Senior Manager at TMF Administrative Services, Financial Manager at Time Zone
Sdn Bhd and also a Associate Director with BDO Consulting Sdn Bhd.
Tan Yew Hock is the Director and Head, Business Development and has over 13 years of experience in business development. He
has a LCCI Certificate in business statistics and management accounting. Working his way up, he joined MR D.I.Y. in 2006 and was
subsequently appointed as director in some of MR D.I.Y. subsidiaries and is a crucial member of MR D.I.Y.’s set-up team for its stores.
Tan Yew Teik is the Director and Head, Logistics and has 15 years of experience in retail business. He is instrumental in developing
MR D.I.Y.’s distribution management and responsible for overseeing its entire supply chain. He has a Bachelors Degree in Public
Management from Universiti Utara Malaysia and joined MR D.I.Y. in 2013.

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Income Statement Financial Data & Ratios

FY Dec (RM m) 2019A 2020A 2021E 2022E 2023E FY Mar 2019A 2020A 2021A 2022E 2023E
Revenue 2,276 2,559 3,260 4,486 5,199 Growth
EBITDA 639 697 869 1,263 1,442 Turnover 28% 12% 27% 38% 16%
Operating Profit 501 525 652 998 1,133 EBITDA 0% 9% 25% 45% 14%
Depreciation
(139) (173) (217) (265) (309) Operating Profit
&Amortz 0% 5% 24% 53% 13%
Interest Inc/(Exp) (65) (69) (41) (41) (41) PBT 0% 5% 34% 57% 14%
Profit Before Tax 438 458 613 959 1,094 Core Net Profit 0% 6% 34% 57% 14%
Taxation (120) (121) (161) (253) (288)
Net Profit 318 337 451 707 806 Profitability
Core PATAMI 318 337 451 707 806 EBITDA Margin 28% 27% 27% 28% 28%
Operating Margin 22% 21% 20% 22% 22%
Balance Sheet PBT Margin 19% 18% 19% 21% 21%
FY Mar (RM m) 2019A 2020A 2021A 2022E 2023E Core Net Margin 14% 13% 14% 16% 16%
Fixed Assets 354 436 369 254 74 Effective Tax Rate -27% -26% -26% -26% -26%
Intangible Assets 694 884 884 884 884 ROA 17% 17% 19% 25% 24%
Other Fixed Assets 17 23 23 23 23 ROE 93% 55% 44% 51% 43%
Inventories 497 690 795 1,094 1,313
Receivables 122 128 169 232 266
Other Current Assets 0 0 0 0 0 DuPont Analysis
Cash 141 91 316 557 1,029 Net Margin (%) 14% 13% 14% 16% 16%
Total Assets 1,824 2,253 2,557 3,045 3,589 Assets Turnover (x) 1.2 1.1 1.3 1.5 1.4
Leverage Factor (x) 5.4 2.6 2.2 1.9 1.7
Payables 82 120 135 185 224 ROE (%) 93% 54% 44% 51% 43%
ST Borrowings 12 243 243 243 243
Other ST Liability 129 161 161 161 161 Leverage
LT Borrowings 612 21 21 21 21 Debt/Asset (x) 0.3 0.1 0.1 0.1 0.1
Other LT Liability 649 832 832 832 832 Debt/Equity (x) 1.8 0.3 0.2 0.2 0.1
Net Assets 340 877 1,166 1,604 2,109 Net (Cash)/Debt 483 173 (53) (293) (766)
Net Debt/Equity (x) 1.4 0.2 (0.0) (0.2) (0.4)
Shareholders' Equity 340 877 1,166 1,604 2,109
Minority Interests 0 0 0 0 0 Valuations
Total Equity 340 877 1,166 1,604 2,109 Core EPS (sen) 31,696 5.2 7.2 11.2 12.8
NDPS (sen) - 0.8 2.9 4.6 5.1
Cashflow Statement BV/sh (RM) 340.5 0.1 0.2 0.3 0.3
FY Mar (RM m) 2019A 2020A 2021A 2022E 2023E PER (x) 0.0 64.8 48.4 31.0 27.2
Operating CF 403 385 576 698 941 Div. Yield (%) 0.0% 0.2% 0.8% 1.3% 1.5%
Investing CF (218) (118) (148) (148) (126) PBV (x) 0.0 24.9 18.7 13.7 10.4
Financing CF (111) (328) (203) (310) (342) EV/EBITDA (x) (0.8) 27.9 30.2 30.7 33.1
Change In Cash 75 (61) 225 240 473
Free CF 286 263 426 548 812

Source: Kenanga Research

Fwd Core PER Band Fwd PBV Band

Source: Bloomberg, Kenanga Research

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Stock Ratings are defined as follows:

Stock Recommendations

OUTPERFORM : A particular stock’s Expected Total Return is MORE than 10%

MARKET PERFORM : A particular stock’s Expected Total Return is WITHIN the range of -5% to 10%
UNDERPERFORM : A particular stock’s Expected Total Return is LESS than -5%

Sector Recommendations***

OVERWEIGHT : A particular sector’s Expected Total Return is MORE than 10%

NEUTRAL : A particular sector’s Expected Total Return is WITHIN the range of -5% to 10%
UNDERWEIGHT : A particular sector’s Expected Total Return is LESS than -5%

***Sector recommendations are defined based on market capitalisation weighted average expected total
return for stocks under our coverage.

This document has been prepared for general circulation based on information obtained from sources believed to be reliable but we do not
make any representations as to its accuracy or completeness. Any recommendation contained in this document does not have regard to the
specific investment objectives, financial situation and the particular needs of any specific person who may read this document. This
document is for the information of addressees only and is not to be taken in substitution for the exercise of judgement by addressees.
Kenanga Investment Bank Berhad accepts no liability whatsoever for any direct or consequential loss arising from any use of this document
or any solicitations of an offer to buy or sell any securities.Kenanga Investment Bank Berhad and its associates, their directors, and/or
employees may have positions in, and may effect transactions in securities mentioned herein from time to time in the open market or
otherwise, and may receive brokerage fees or act as principal or agent in dealings with respect to these companies.

Published and printed by:

KENANGA INVESTMENT BANK BERHAD (15678-H)

Level 17, Kenanga Tower, 237, JalanTunRazak, 50400 Kuala Lumpur, Malaysia
Telephone: (603) 2172 0880 Website: www.kenanga.com.my E-mail: research@kenanga.com.my

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