Below estimates. Evergreen Fibreboard's annualised core net profit accounted for only 39.0% of our full year forecast despite chalking in a revenue growth of 12.9% y-o-y. Core net profit grew 74.3% y-o-y, underpinned by better sales and steady average selling prices (ASP) for most of its products, as well as having effective cost reduction measures in place.

Nothing interesting in FY12. While the company's earnings should improve y-o-y, we do not foresee very strong growth due to the lack of catalysts this year. We are thereby trimming our earnings forecast for FY12 and FY13 by 9.2% and 11.0% respectively. Nonetheless, there could still be a surprise to our FY13 estimates as the company is in the midst of setting up a sales team to sell the excess capacity of its glue. We have not factored this into the earnings estimate as yet, but will closely monitor the progress of this venture and will tweak our earnings estimate upwards accordingly, if we foresee any significant contributions in FY13.

Maintain BUY. We think that the company's earnings outlook for the year remains positive on a y-o-y comparison but earnings growth will not be very strong due to the lack of a catalyst. The FV for the stock is now revised downwards from RM1.05 to RM1.02, pegged to 7x of its 12 months' forward earnings. We maintain a BUY recommendation on the stock, as there is still an upside of 23.6% to the FV.

Source: OSK