Period  

2Q12 

The 1H 12 net profits (NP) of RM75.9m was broadly in line with estimates, making up 34.8% and 34.0% of the street's estimate and our forecast of RM223.2m. The 1H is seasonally slower than the 2H and typically contributes around 34%-45% of the full year earnings. 

Dividends  

No dividend was declared in the quarter. 

With the rising number of shopping outlets in the Klang Valley, the company is now aiming on areas outside the Klang Valley to capture the rising group of middleincome earners in these areas. For example, following the opening of its outlet in Ipoh recently (March 2012), we are expecting another new outlet in Seri Manjung, Perak at the end of this year and then another three more in FY13-14. Change to Forecasts Sales in the second half of the year should be better due to the festive season. Thus, we are maintaining our earnings estimates of RM223.2m and RM251.8m for FY12-13E. 

Rating 

MAINTAIN MARKET PERFORM 

Valuation  

We are rolling over our valuation basis to FY13 and with it, our TP has been revised upwards to RM10.70 from RM9.54 previously. Our TP is based on Fwd PER of 15x, which represents a +1.5 SD to the 5-year average PER of 12x. 

Risks  

Risk to our call is a slowdown in the global economy, which will cut down the purchasing power of consumers.

Source: KenagaResearch