Parkson  Holding  Berhad  (PHB)'s  51.7%  equity-owned  Parkson  Retail Group (PRG) announced that  the  arbitral  award  dated 25  March  2015  by China International Economic and Trade Arbitration Comission has ordered the  group  to  pay  a  total  sum  of  RMB140m  (RM83.9m)  to  its  landlord  in Beijing,  China  for  the  continued  occupation  of  four  floors  of  Metro  City Shopping Plaza after the termination of its tenancy agreement. (Source: Bursa Malaysia)

Comments:  While  we  are  negative  on  the  news  in  the  short-term,  we believe that this would not impact the group's operations as PRG has since closed its operations in the aforementioned mall in Dec 2012. We maintain our earnings forecast and SELL rating as we  believe that PHB's earnings will continue to be weighed  down by its weak China operations (due to a challenging retail environment) and slowing growth in Malaysia in Vietnam. Our RNAV-derived TP of RM2.00 remains unchanged.

Source: Affin Hwang Capital Research - 1 Apr 2015