(JCYH MK/HOLD/RM0.59/Target: RM0.59)

3QFY17 results came in below expectations. 3QFY17’s sales were largely decent, but JCY still saw margin erosion. Pricing pressure and long-term structural risks remain concerns. JCY cut its quarterly dividend to 0.75 sen/share, the lowest since 2QFY14. However, its strong cash pile and positive operating cash flow will sustain its ability to pay out quarterly dividends. JCY may benefit from WD relocating production from China to Malaysia. Maintain HOLD. Entry price: RM0.55. Target price: RM0.59.

Source: UOB Kay Hian Research - 17 Aug 2017