HLIB starts coverage on UMC 0256 UMEDIC GROUP BERHAD, target price 61 sen
KUALA LUMPUR (July 26): Hong Leong Investment Bank (HLIB) Research has initiated coverage on UmediC Group Bhd (UMC) at an IPO price of 32 sen with a “Buy’ rating and target price (TP) of 61 sen and said that a beneficiary of the pandemic, UMC saw its core earnings grow at a CAGR of 103% from FY19-FY21 due to a boost in medical devices and consumables’ demand.
In a note on Monday (July 25), the research house said that going forward, it is are projecting for FY22/23/24f earnings to grow by 31.7%/41.0%/18.1%, far exceeding the 12.1% CAGR projected by Protégé for the local medical device industry.
“We initiate coverage on UMC with a Buy recommendation and TP of 61 sen based on a P/E multiple of 18x (in line with peers average).
“While we acknowledge that UMC’s market capitalisation is considerably smaller, we deem the valuation justifiable as we believe this is compensated by the stronger earnings growth expected,” it said.
http://www.theedgemarkets.com/article/hlib-starts-coverage-umedic-target-price-61-sen
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