Upgrade to Buy with a higher TP of RM5.38, ahead of an anticipated sector recovery in 2H 2012. This follows a 17-18% rise in 2012-13 net profit forecasts, on higher vehicle sales assumptions (+9-21%). We reckon the disruption to the regional parts supply chain, margin weakness and poor Jan-Mar 2012 performance have all been priced in. Our TP (+35%), premised on 10x 2013 PER (previously 8x), offers 20% upside. Our re-rated PER target reflects improved optimism ahead.

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Source: Maybank Research - 6 April 2012