Kenanga Research lowers target price for CTOS Digital to RM1.55

KUALA LUMPUR (July 27): Kenanga Research has maintained its “outperform” rating on CTOS Digital Bhd at RM1.31 with a lower target price (TP) of RM1.55 (from RM1.65) and said 1HFY22 normalised PATAMI of RM39.5 million (+27% y-o-y) and interim dividend of 0.59 sen declared are within expectations.

In a note on Wednesday (July 27), the research house said that it was reviewing its terminal growth assumption on slightly less optimistic long-term outlook resulting in a lower DCF-TP of RM1.55 (from RM1.65; WACC: 6.2%; TG: 5%).

“We applied a 5% premium to our TP based on our 4-star ESG rating on the group for its position as a sustainability enabler as well as commendable board representation.

“We believe CTOS serves as a solid syariah-compliant and ESG pick,” it said.