There's Company Research Downgrade and then there is the (Aisayman!!!) "Company Research Downgrade"

I have not been holding any glove stocks for the last 3 weeks. So I try to be objective here.

Fact 1: 29 May 2020, research report by Macquarie, Outperform TP RM13.10.

Fact 2: 25 August 2020, research report by Macquarie, Outperform 12 month target RM30.40.

Fact 3: 9 September 2020, research report by Macquarie Downgrade to TPRM5.40.

Fact 3: First two reports by Denise Soon. The downgrade report by Prem Jearajasingam.

Fact 4: Macquarie is one of the top covered warrants issuer in Malaysia.

Fact 5: Ex basis the RM30.40 would have been equaled to RM10.13. Which is to say the down grade wasn't just 10% or 20% in target price. The downgrade to RM5.40 is an astounding 46% cut in TP.

Fact 6: 46% cut in TP all in a matter of 15 days. Pray tell what were the variables that caused such a decision.

Bursa and SC need to look into this closely cause I am sure you have already received a lot of complaints. I guess you cannot have the same analyst do all 3 reports as that would have been tantamount to harakiri for the analyst. The change in analyst has to be questioned. Apparently, Prem is the Head of Research, and Denise has left her position. Still, Prem would have had to approve the previous reports.

The "new analyst" halved the TP on the basis that "ASP cannot sustain forever". What changed the analyst's forecast within this short 2 weeks? Did he suddenly talk to industry leaders worldwide to realise that ASP will not last forever?

Analysts/research heads have very little power as they do not bring in the big bucks. Before investors focus their ire on them, remember that. But this does not feel right. It leaves a very bad taste in our mouths. The integrity of the markets and the participants are at stake. We need answers and clarity.

THE FUNNIEST THING ... and its a big mistake by Macquarie... look at the table for projections. The first table was by on the upgrade to TPRM30.40. The estimated revenue for 2021 and 2022 were RM12.14bn and RM7.413bn respectively. Reported profit for 2021 and 2022 were RM4.646bn and RM850m respectively.

THE DOWNGRADE REPORT projected revenue for 2021 and 2022 to RM19.058bn and RM9.023bn respectively. The expected profit for 2021 and 2022 were RM10.259bn and RM2.022bn respectively.

How da-macha? The massive downgrade report had a substantive upgrade in revenue and profit. SUDDENLY the valuation parameters changed???

It is not even funny, when within 15 days one can revised the profit UPWARDS from 4.64bn to 10.259bn (+110%) for 2021 and from 850m to 2.022bn (+138%) for 2022 ... and at the same report downgrade the TP from RM10.13 to RM5.40 (-46%).

Please explain.