4 KEYS ELEMENTS MCO LOCK-DOWN BENEFIT BAT:

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1^st of all, at current price levels, BAT yields an attractive 11.0% based on our FY20 dividend forecast. Prior last many years before MCO lockdown, illicit cigarettes continue to make up the bulk of tobacco volumes in Malaysia, due to local enforcement authorities not efficient in clamping down illicit cigarettes in the market, plateaued for two years now, between 61-65%. If half or 30% illicit cigarettes sales convert to legal sales, this will boost their sales definitely due to continuously police monitor during this lock down period.

2^nd , its share price drop from RM37 to RM10+, already drop almost 80% from the highest 52week price with no or less impact to BAT business revenue sales.

3^rd, current share price give 11% to 12% dividend payout yearly, way better than put your cash in FD for 2.5% return with sustainable business income rolling in coming many months and years.

4^th, refer to the last Q4’19 report, it result show rebound of RM94mil (EPS 34.2sen) return, net profit margin after tax rebound back to 14.2% vs worst last 2 Qtr due to operating profit efficiency improved.

In summary, there is no right or wrong, but it is an opportunity to consider buy BAT with great offer to keep for mid and long term investor. Based on average analyst Target Price range, it can reach within RM15 to RM16 (<1year time frame) . I believe RM15 is easily achievable if next 2 Qtr result perform better within RM80mil earning + 100% dividend payout every Qtr.