Kossan reported a headline net profit growth of 383.9% YoY in FY20, to a record high of RM1.09bn. The stellar results included a one-off asset disposal gain of RM50.7m. Stripping out the non-recurring contribution, Kossan’s core net profit for FY20 stood at RM1.04bn, still registering a whopping 361.9% YoY increase. The results came in within both our and street estimates at 98% and 94% respectively. We highlight that Kossan’s capacities for FY21 are fully taken up and it expects ASP increases to sustain up till 3QFY21 at least. Kossan also expects a 50% QoQ ASP increase in 1QFY21. We roll over our valuation to CY22F EPS and our TP is subsequently lowered to RM6.10, pegged to an unchanged PE multiple of 9x. We maintain our Trading Buy call on Kossan. On a side note, Kossan has also declared an interim dividend and special dividend of 3sen and 8sen respectively.
Phase (6 lines, +2.0bn pcs pa) will begin commissioning in 2HCY21, while commissioning of the 2nd Phase (10 lines, +3bn pcs pa) is scheduled to begin in 1HCY22.
Source: PublicInvest Research - 17 Feb 2021
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KOSSANCreated by PublicInvest | Aug 12, 2024
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2021-02-18 18:04