By Admin
PETALING JAYA: Bermaz Auto Bhd (BAuto) looked poised for steady growth in the coming financial year, driven by its new model offerings and strategic focus on customer retention.
While the competitive landscape in the mid-segment remained intense, the group’s valuation continued to appear attractive, underpinned by a strong dividend yield and a promising vehicle line-up.
MIDF Research, following a virtual call with BAuto, maintained its earnings estimates ahead of the group’s third-quarter results announcement on March 12, 2025.
However, the research house revised its target price to RM1.97 from RM2.21, adjusting its valuation methodology to “better reflect the intense competition in the mid-segment.” Despite this revision, it reiterated its “buy” call, citing an appealing dividend yield of 12.8%.
“We believe that BAuto’s new model offerings remain promising, and we are sanguine about the group’s efforts to prioritise customer retention over aggressive discounting,” MIDF Research stated.
The introduction of new models was expected to bolster BAuto’s performance. The fifth-generation Kia Sportage, launched as a completely knocked-down (CKD) unit in December 2024, saw its initial demand affected by late deliveries in mid-January, coinciding with festive celebrations.
“At present, approximately 100 units have been sold, while about 50 remain on order,” the research house noted, adding that further updates on customer reception would be disclosed in BAuto’s upcoming results announcement.