KUALA LUMPUR (Jan 26): Hong Leong Investment Bank (HLIB) Research sees limited downside for Star Media Group Bhd, despite the possible economic slowdown of the media sector in 2023.

In a technical tracker note on Thursday (Jan 26), HLIB said it expects the media company's share price to advance further to between 35 sen and 42 sen.

“Technically, Star has staged a decisive breakout above its long-term resistance level of 31.5 sen yesterday (Wednesday), which indicated the start of a new upleg. Taking our cue from the bullish momentum, we expect Star to advance further towards the 35 sen, 39 sen, and 42 sen levels,” according to analyst Sam Jun Kit.

Sam added that while the looming economic slowdown in the financial year ending Dec 31, 2023 may dampen advertising expenditure, there is limited downside for Star, due to its net cash per share (NCPS) of 46.8 sen and net tangible assets per share (NTA) of 90 sen.

“Since the onset of Covid-19, Star’s share price has eased 38% from a high of 49 sen to 30.5 sen on Wednesday, implying a 34% discount against its NCPS and a 66% discount against its NTA.

“Besides, the market has yet to fully appreciate its huge undervalued list of properties, notably the industrial land bank in Bayan Lepas, Bentong and Shah Alam, booked at 1997-2004’s valuations.

“Hence, should there be a revaluation or disposal of its properties, we reckon Star’s NTA/NCPS will be even higher, making Star a more palatable investment name,” said Sam.

At the time of writing, Star Media’s share price had increased by half a sen or 1.52% to 34 sen, after opening at 33 sen. Its market capitalisation stood at RM243.43 million.