OSK Research maintains TP of RM13 for Public Bank
Written by OSK Research
Tuesday, 06 July 2010 08:52

KUALA LUMPUR: OSK Research is maintaining its target price of RM13 for PUBLIC BANK BHD [], which implies a return on equity of 26% and price-to-book value multiplier of 3.80 times.

It said on Tuesday, July 6 the current share price implies a relatively conservative 22% ROE vs management?s three-year targets of 30%.

?More intensive capital usage and greater focus on capital light high ROE, as well as high fee income are expected to help sustain the group?s robust profit generation trend,? it said.

OSK Research said the risk of potentially onerous regulatory core equity capital requirements has been overplayed as the possible dilution is less than 10% on a worst-case scenario.

?Investors should focus on the group?s agility in meeting such requirements from its excess reserves given its strong and stable asset quality and minimal exposure to derivatives, trading and off-balance sheet instruments,? it said.


http://www.theedgemalaysia.com/business-news/169259-osk-research-maintains-tp-of-rm13-for-public-bank.html