Proton; Hold; RM5.48
Price Target: RM5.50; PROH MK

According to the local media, managing director Datuk Seri Syed Zainal Abidin has revealed details on the newly anticipated model, P3-21A (officially named as Proton Preve) yesterday. Proton Preve will be launched on April 16 at a price tag of between RM62k (for an entry level model with manual transmission) and RM75k (for its high specifications model). There is also a medium line unit which may be sold for less than RM70k.

According to Proton's managing director, the new model ' which costs RM540m to be developed ' is expected to rake in monthly sales of 4k-5k units.

The company's sales projections are above our conservative total sales forecast of 8k-10k units of Proton Preve this year, as demand could be held back by a possible production capacity constraint. Based on an ASP of RM68.5k, we estimate the 8k-10k unit sales will translate to a revenue contribution of RM548m- RM685m (or 5.3%-6.6%) of our FY13F's topline earnings of RM10.4bn.

Meanwhile, in an announcement made to Bursa yesterday, the unconditional takeover offer by DRBHICOM to acquire all the remaining shares in Proton at RM5.50 per share will close on April 25.

We maintain our Hold rating for Proton with RM5.50 TP (which is pegged to the offer price).

Source: HwangDBS Research - 5 April 2012